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The following information was collected for the first year of manufacturing for Appliance Apps:

Direct Materials per Unit	$2.25
Direct Labor per Unit	$1.50
Variable Manufacturing Overhead per Unit	$0.25
Variable Selling and Administration Expenses	$1.75
Units Produced	41,000
Units Sold	35,000
Sales Price	$13
Fixed Manufacturing Expenses	$123,000
Fixed Selling and Administration Expenses	$21,000

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Prepare an income statement under variable costing method.

Prepare a reconciliation to the income under the absorption method.