$ $ 40 per unit 60 per unit $ 20 per unit $8,400,000 (per year) Manufacturing costs Direct materials Direct labor Overhead costs Variable Fixed Selling and administrative costs for the year Variable Fixed Production and sales for the year Units produced Units sold Sales price per unit $ 725,000 $4,000,000 105,000 units 75,000 units 360 per unit $ 1. Prepare an income statement for the year using variable costing. 2. Prepare an income statement for the year using absorption costing. X Answer is not complete. Variable Costing Income Statement Sales $ 27,000,000 Less: Variable costs Direct materials Direct labor $ 3,000,000 4,500,000 1,500,000 725,000 Variable overhead costs Variable selling and administrative expenses Total variable costs 9,725,000 17,275,000 Contribution margin Less: Fixed expenses Fixed overhead costs Fixed selling and administrative costs 8,400,000 4,000,000 Total fixed expenses Net income (loss) 12,400,000 $ 4,875,000 SIMS COMPANY Absorption Costing Income Statement Sales $ 27,000,000 Direct labor Direct materials Variable overhead costs Fixed overhead costs $ 4,200,000 63,000 1,500,000 6,000,000 11,763,000 Cost of goods sold Gross margin Selling general and administrative expenses Variable selling and administrative expenses Fixed selling and administrative costs 725,000 4,000,000 ~ 4,725,000 Total selling, general and administrative expenses Net income (loss)