Moseley Corp. currently uses variable costing in its accounting system, with the following selected results (assume there were no variances):

Contribution margin ………………… $300,000

Variable selling and administrative … $100,000

Fixed selling and administrative …….. $ 60,000

Net income ………………………… $150,000

During the period Moseley produced 160,000 units and sold 80,000 units. Selling price is $10/unit. There was no beginning or ending WIP inventory, and no beginning FG inventory. Moseley is considering a standard absorption costing system. It estimates that if it had used such a system this year, it would have budgeted fixed factory overhead at $100,000, and would have selected a denominator level of 200,000 units. The company also estimates that there would have still been no variances related to direct materials, direct labor, and variable factory overhead.

Present a standard absorption costing income statement with proration. Be sure to present the adjustment for variances amount on the income statement.