Problem 8-15 Prepare and Reconcile Variable Costing Statements [LO1, LO2, LO3, LO4] Audiophonics Limited manufactures and sells high-quality and durable ear buds for use with personal electronics that are custom moulded to each customer's ear. Cost data for the product follow: Variable costs per unit: Direct materials 10 Direct labour 19 Variable factory overhead 5 Variable selling and administrative Total variable costs per unit 39 Fixed costs per month: Fixed manufacturing overhead $126, 400 Fixed selling and administrative 173, 800 Total fixed cost per month $300, 200 The product sells for $60 per unit. Production and sales data for May and June, the first two months of operations, are as follows: Units Produced Units Sold May 15, 800 13, 400 June 15, 800 18, 200Income statements prepared by the Accounting Department using absorption costing are presented below: May June Sales 5 504,0 $1,92,0 Cost of goods sold: Beginning inventory 0 100,3 Add cost of goods manufactured 63,500 63,600 Goods available for sale 63,5 764,4 Less ending inventory 100,3 0 Cost of goods sold 562,3 ?64,4 Gross margin 241,2 327,60 Selling and administrative expenses 240,3 264,3 Operating income 5 4\\.$ 62,30 Required: 1. Determine the unit product cost under each of the following methods. 5- n- 2. Prepare variable costing income statements for May and June using the contribution approach. (Do not leave any empty spaces; input a 0 wherever it is required.) May June Sales Variable expenses: Variable cost of goods sold: Beginning inventory Add: Variable production costs Goods available for sale 0 0 Less: Ending inventory Variable cost of goods sold 0 0 Variable selling and administrative Total variable expenses 0 0 Contribution margin 0 0 Fixed expenses: Fixed manufacturing overhead Fixed selling and administrative Total fixed expenses 0 0 Operating income (loss) 0 0