Exercise $6-2($Algo$)$ Variable Costing Income Statement; Explanation of Difference in Net Operating Income $[$LO$6-2]$

Ida Company produces a handcrafted musical instrument called a gamelan that is similar to a xylophone. The gamelans are sold for $$950.$ Selected data for the company$$s operations last year follow:

Units in beginning inventory $0$

Units produced $250$

Units sold $230$

Units in ending inventory $20$

Variable costs per unit:

Direct materials $ $125$

Direct labor $ $335$

Variable manufacturing overhead $ $55$

Variable selling and administrative $ $30$

Fixed costs:

Fixed manufacturing overhead $ $75,000$

Fixed selling and administrative $ $15,000$

The absorption costing income statement prepared by the company$$s accountant for last year appears below:

Sales $ $218,500$

Cost of goods sold $187,450$

Gross margin $31,050$

Selling and administrative expense $21,900$

Net operating income $ $9,150$

Required:

$2.$ Prepare an income statement for last year using variable costing.