Problem 6-22 (Algo) Variable Costing Income Statements; Income Reconciliation (LO6-1, LO6-2, L06-3] Denton Company manufactures and sells a single product. Cost data for the product are given: Variable costs per unit: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative Total variable cost per unit Fixed costs per month: Pixed manufacturing overhead Fixed selling and administrative Total fixed cost per month 11 4 1 S 20 $ 81,000 166,000 $ 247,000 The product sells for $53 per unit. Production and sales data for July and August, the first two months of operations, follow: July August Units Produced 27,000 27,000 Unita Sold 23,000 31,000 The company's Accounting Department has prepared the following absorption costing income statements for July and August: Sales Cost of goods sold Groes margin Selling and administrative expenses Net operating income July August $ 1,219,000 $1,643,000 506,000 682,000 713,000 961,000 189,000 197,000 $ 524,000 $ 764,000 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