Thwart Products Inc. produces smart phones. The company has no finished goods inventory at the beginning of year 1. The following information pertains to Thwart Products Inc. 160,000 $ 300 Annual production (units) Sales price per unit Variable production cost per unit: Direct materials $ 80 Diirect labor $ 70 Manufacturing overhead $ 60 Fixed production costs $ 260,000 Variable selling and admin cost per unit Fixed selling and admin costs per year $ 16 $ 310,000 All 160,000 units produced during year 1 were sold during year 1. Required: A. Prepare a traditional income statement assuming the company uses absorption costing. B. Prepare a contribution margin income statement assuming the company uses variable costing. A Absorption Costing Income Statement Sales Cost of goods sold Gross margin Variable selling and admin costs Fixed selling and admin costs Total selling and admin costs Operating profit B Variable Costing Income Statement Sales Variable costs: Variable production costs Variable selling and admin costs Total variable costs Fixed costs: Fixed Production costs Fixed Selling and Admin costs Total fixed costs Operating profit Sheet1 Sheet2 Sheet3