Return to question Sims Company began operations on January 1. Its cost and sales information for this year follow. Direct materials Direct labor Variable overhead Fixed overhead Variable selling and administrative expenses Fixed selling and administrative expenses Units produced Units sold Sales price $ 35 per unit $ 55 per unit $ 20 per unit $ 8,400,000 per year $ 11 per unit $ 4,500,000 per year 105,000 units 75,000 units $ 360 per unit 1. Prepare an income statement for the year using variable costing. 2. Prepare an income statement for the year using absorption costing. Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare an income statement for the year using variable costing. SIMS COMPANY Income Statement (Variable Costing) Sales $ 27,000,000 Less: Variable expenses Direct materials $ 2,625,000 X 4,125,000 X Direct labor 825,000 7,575,000 19,425,000 Variable selling and administrative expenses Contribution margin Plus: Fixed expenses Fixed selling and administrative expenses Fixed overhead 4,500,000 8,400,000 12,900,000 $ 6,525,000 Income X Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare an income statement for the year using absorption costing. SIMS COMPANY Income Statement (Absorption Costing) $27,000,000 Sales 8,250,000 18,750,000 Cost of goods sold Gross profit Selling and administrative expenses Loss 5,325,000 x $ 13,425,000