Problem 7-20 Variable and Absorption Costing Unit Product Costs and Income Statements; Explanation of Difference in Net Operating Income (L07-1, L07-2, L07-3] High Country, Inc., produces and sells many recreational products. The company has just opened a new plant to produce a folding camp cot that will be marketed throughout the United States. The following cost and revenue data relate to May, the first month of the plant's operation 38,000 33,000 79 $ Beginning inventory Units produced Units sold Selling price per unit Selling and administrative expenses: Variable per unit Fixed (per month) Manufacturing costs: Direct materials cost per unit Direct labor cost per unit Variable manufacturing overhead cost per unit Fixed manufacturing overhead cost (per month) $ $ 566,000 $ 15 $ 7 $ 1 $ 684,800 Management is anxious to assess the profitability of the new camp cot during the month of May Management is anxious to assess the profitability of the new camp cot during the month of May. Required: 1. Assume that the company uses absorption costing. a. Determine the unit product cost. b. Prepare an income statement for May 2. Assume that the company uses variable costing. a. Determine the unit product cost. b. Prepare a contribution format income statement for May. Complete this question by entering your answers in the table below. Req 1A Req 1B Req 2A Req 2B Prepare an income statement for May. Assume that the company uses absorption costing. High Country, Inc. Absorption Costing Income Statement Complete this question by entering your answers in the table belo Req 1A Req 1B Req 2A Req 2B Prepare an income statement for May. Assume that the company uses abs High Country, Inc. Absorption Costing Income Statement Sales $ 2,607,000 Cost of goods sold Gross margin 2,607,000 Selling and administrative expenses Net operating income $ 2,607,000 3 Reg 1A Rec a. Determine the unit product cost. b. Prepare a contribution format income statement for May. Complete this question by entering your answers in the table below. Req 1A Req 1B Reg 2A Req 2B Determine the unit product cost. Assume that the company uses variable cost Unit product cost