The following information pertains to the first year of operation for Sonic Boom Radios, Inc.

Required:

Prepare Sonic Boom’s full absorption costing income statement and variable costing income statement for the year.

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Number of units produced Number of units sold Unit sales price 3,000 2,500 $ 350 Direct materials per unit 70 Direct labor per unit 60 Variable manufacturing overhead per unit 10 Fixed manufacturing overhead ($225,000/3,000 units) 75 Variable selling expenses ($15/unit sold) 37,500 Fixed general and administrative expenses 65,000