Question 7 Not complete Marked out of 20.00 P Flag question Absorption and Variable Costing Comparisons: Sales Exceed Production Wright Development purchases, develops, and sells commercial building sites. As the sites are sold, they are cleared at an average cost of $4,000 per site. Storm drains and driveways are also installed at an average cost of $5,500 per site. Selling costs are 10 percent of sales price. Administrative costs are $435,000 per year. During 2016, the company bought 1,000 acres of land for $5,000,000 and divided it into 200 sites of equal size. The average selling price per site was $100,000 during 2016 when 50 sites were sold. During 2017, the company purchased and developed another 1,000 acres, divided into 200 sites. The purchase price was again $5,000,000. Sales totaled 300 sites in 2017 at an average price of $100,000. Required a. Prepare 2016 and 2017 functional income statements using absorption costing, Use a negative sign only to indicate a net loss for income. Otherwise, do not use negative signs with your answers. Wright Development Functional Income Statements For the Years 2016 and 2017 2016 2017 Sales Cast of sales 0 Gross profit Selling and administrative expenses: Net Income (loss) $ 0 $ 0 0 0 0 0 0 $ 0 $ b. Prepare 2016 and 2017 contribution income statements using variable costing. Use a negative sign only to indicate a net loss for income. Otherwise, do not use negative signs with your answers. Wright Development Contribution Income Statements For the Years 2016 and 2017 2016 2017 Sales 0 Variable costs Contribution margin Fixed expenses Net income (loss) $ $ 0 0 0