ABC co sells a single product and the information below shows information for the first two years of operations Variable costs per unit: Manufacturing: Direct materials $ 54 Direct labor $ 32 Variable manufacturing overhead $ 6 Variable selling and administrative $ 4

Fixed costs per year:

Fixed manufacturing overhead $ 640,000

Fixed selling and administrative expenses $ 160,000

During its first year of operations, Fletcher produced 100,000 units and sold 80,000 units. During its second year of operations, it produced 80,000 units and sold 100,000 units. The selling price of the companys product is $ 114 per unit.

1. Assume the company uses absorption costing: What is the cost per unit in year 1 and 2. Also prepare income statement for year 1

2. Assume the company uses variable costing . Find the unit cost in year 1 and 2. Also prepare income statement for year 1.