The following is the absorption costing income statement of Alpha Manufacturing Company for the year ended December 31, 2016: ALPHA MANUFACTURING COMPANY Income Statement (Absorption Costing) For the Year Ended December 31, 2016 Sales (40,000 units - $67.50) Less cost of goods sold: Opening inventory Add cost of goods manufactured (50,000 units $42) Cost of goods available for sale Less closing inventory (10,000 units - $42) Gross profit Less selling and administrative expenses Net operating income $ $2,700,000 2,100,000 2,100,000 420,000 1.680,000 $1,020,000 840,000 $ 180,000 Fixed selling and administrative expenses are $600,000. Variable selling and administrative expenses are $6 per unit sold. The unit product cost under absorption costing is computed as follows: Required: Direct material Direct labor Variable manufacturing overhead Fixed overhead manufacturing ($500,000 50,000 units) Unit product cost 20 8 4 10 $ 42 1. Prepare an income statement of Alpha Manufacturing Company using variable costing system.