Problem 4-22 (Algo) Variable Costing Income Statements; Income Reconciliation (LO4-1, LO4-2, L04-3] Denton Company manufactures and sells a single product. Cost data for the product are given: Variable conta per unit: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative Total variable cost per unit Fixed costs per month Fixed manufacturing overhead Fixed selling and administrative Total fixed cost per month $ 3 10 2 1 $ 16 $ 120,000 166.000 $ 286,000 The product sells for $54 per unit. Production and sales data for July and August, the first two months of operations, follow: July Augunt Units Produced 24,000 24,000 Unita Sold 20,000 28.000 The company's Accounting Department has prepared the following absorption costing Income statements for July and August July August Bolon $1,000,000 $1,512,000 Coat of goods sold 400,000 560,000 Grons margin 680,000 952,000 Selling and administrative expenses 186,000 194,000 Net operating income 5 494,000 750,000 Required: 1. Determine the unit product cost under: 2A Nave 2. Prepare variable costing income statements for July and August 3. Reconcile the variable costing and absorption costing net operating incomes. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Prepare variable costing income statements for July and August. Denton Company + Variable Costing Income Statement July August Sales $ 1,080,000 $ 1,512,000 Variable expenses: Variable cost of goods sold 300,000 420,000 Variable selling and administrative expenses 20,000 28,000 320,000 760,000 448,000 1,064,000 Total variable expenses Contribution margin Fixed expenses: Fixed manufacturing overhead Fixed selling and administrative expenses 120,000 166,000 120,000 166,000 Total fixed expenses Net operating income (loss) 286,000 $ 474,000 286,000 778,000 $ Required: 1. Determine the unit product cost under: a. Absorption costing. b. Variable costing. 2. Prepare variable costing income statements for July and August. 3. Reconcile the variable costing and absorption costing net operating incomes. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Reconcile the variable costing and absorption costing net operating incomes. (Enter any losses or deductions as a negative value.) Reconciliation of Variable Costing and Absorption Costing Net Operating Incomes August Variable costing net operating Income (loss) Add (deduct) fixed manufacturing overhead cost deferred in (released from) inventory under absorption costing Absorption costing net operating income (loss) July