Exercise 06-4 Variable costing income statement LO P2 points Kenzi Kayaking, a manufacturer of kayaks, began operations this year. During this first year, the company produced 1.025 kayaks and sold 775 at a price of $1,025 each. At this first year-end, the company reported the following income statement information using absorption costing $ eBook Sales (775 x $1,025) Cost of goods sold (775 x $480) Gross margin Selling and administrative expenses Net income 794,375 310,000 484,375 220,000 264,375 Hint Additional Information a. Product cost per kayak totals $400, which consists of $300 in variable production cost and $100 in fixed production cost-the latter amount is based on $102.500 of fixed production costs allocated to the 1,025 kayaks produced. b. The $220,000 in selling and administrative expense consists of $95,000 that is variable and $125,000 that is fixed. Print References Required: 1. Prepare an income statement for the current year under variable costing. 2. Fill in the blanks: Complete this question by entering your answers in the tabs below. Required i Required 2 Prepare an income statement for the current year under variable costing. $ 794 375 KENZI KAYAKING Variable Costing Income Statement Sales Less: Fixed expenses Variable product costs Variable selling and administrative expenses 95,000 95,000 Total variable costs Contribution margin Less: Fixed expenses Fixed overhead costs Fixed selling and administrative costs Total fixed expenses Net income (loss) 102,500 210,000 $ Net income under absorption costing is higher than net income under variable costing by Number of units added to subtracted from) inventory Fixed overhead cost per unit Fixed costs added to inventory [$ 1 S $ 25,000 250 100 25,000 Required 1 Required 2 >