Zule Company produces a single product. Its income statements under absorption costing for its first two years of operation follow. Income Statements (Absorption Costing) Year 1 Year 2 Sales ($35 per unit) $1,925,000 $2,275,000 Cost of goods sold ($26 per unit) 1,430,000 1,690,000 Gross profit 495,000 585,000 Selling and administrative 365,000 395,000 expenses Income $ 130,000 $ 190,000 Additional Information 1. Sales and production data for these first two years follow. Year Year Units 1 Units 60,000 60,000 produced Units sold 55,000 65,000 > Its variable costs per unit and fixed costs per year are unchanged during these years. Its $26 per unit product cost using absorption costing consists of the following Direct materials Direct labor 6 Variable overhead Fixed overhead (5480,000/60,000 units Total product cost per unit 526 Its selling and administrative expenses consist of the following Selling and Administrative Expenses Year 1 Year 2 Variable selling and administrative ($3 per $165,000 $195,000 unit sold) Fixed selling and administrative 200,000 200,000 Total $365,000 $395,000 Required Prepare income statements under variable costing for each of these two years. $4