4 Exercise 19-8 (Algo) Variable costing income statement LO P2 1.42 points 03 03:03:36 Kenzi, a manufacturer of kayaks, began operations this year. During this year, the company produced 1,050 kayaks and sold 800 at a price of $1,050 each. At year-end, the company reported the following income statement information using absorption costing. Sales (800 x $1,050) Cost of goods sold (800 x $425) Gross profit Selling and administrative expenses Income Additional Information $840,000 340,000 500,000 240,000 $ 260,000 a. Product cost per kayak under absorption costing totals $425, which consists of $325 in direct materials, direct labor, and variable overhead costs and $100 in fixed overhead cost. Fixed overhead of $100 per unit is based on $105,000 of fixed overhead per year divided by 1,050 kayaks produced. b. The $240,000 in selling and administrative expenses consists of $95,000 that is variable and $145,000 that is fixed. Prepare an income statement for the current year under variable costing. Answer is not complete. KENZI Income Statement (Variable Costing) Sales Less: Variable expenses Variable cost of goods sold Variable overhead costs Contribution margin Plus: Cost of goods sold Income 840,000 $ 260,000 95,000 355,000 485,000 $ 485,000