Using variable costing and absorption costing}

The chief executive officer of Benjamin Corporation attended a conference in which one of the sessions was devoted to variable costing. The CEO was impressed by the presentation and has asked that the following data of Benjamin Corporation be used to prepare comparative statements using variable costing and the company's absorption costing. The data follow:

Direct materials Direct labor .. Variable factory overhead Fixed factory overhead... Fixed marketing and administrative expense $ 90,000 120,000 60,000 150,000 180,000 The factory produced 75,000 units during the period, and 70,000 units were sold for $700,000. 1. Prepare an income statement using variable costing. 2. Prepare an income statement using absorption costing.