42 Direct materials Direct Labor Manufacturing overhead Variable Fixed ($18.28/unit for 1,300 units). Variable selling and administrative expenses Fixed selling and administrative expenses $ 38.20/unit $ 27.60/unit $ 11.00/unit $23,660 $ 6,240 $14,000 The company produced 1.300 units and sold 800 of them at $180.60 per unit. Assume that the production manager is paid a 3 percent bonus based on the company's net income. Required a. Prepare an income statement using absorption costing. b. Prepare an income statement using variable costing. c. Determine the manager's bonus using each approach. Which approach would you recommend for internal reporting? Complete this question by entering your answers in the tabs below. Required A Required B Required C Prepare an income statement using absorption costing. FANNING COMPANY Income Statement (Absorption Costing) Cost of goods Sold < Prev 6 of 12 Next >