Required information Case 4-29 (Algo) Variable and Absorption Costing Unit Product Costs and Income Statements [LO4-1, LO4-2] [The following information applies to the questions displayed below.] O'Brien Company manufactures and sells one product. The following information pertains to each of the company's first three years of operations: 16 Variable costs per unit: Manufacturing: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative expenses $530,000 $ 200,000 During its first year of operations, O'Brien produced 95,000 units and sold 71,000 units. During its second year of operations, it produced 77,000 units and sold 96,000 units. In its third year, O'Brien produced 84,000 units and sold 79,000 units. The selling price of the company's product is $74 per unit. Required: 1. Assume the company uses variable costing and a FIFO inventory flow assumption (FIFO means first-in first-out. In other words, it assumes that the oldest units in inventory are sold first): a. Compute the unit product cost for Year 1, Year 2, and Year 3. b. Prepare an income statement for Year 1, Year 2, and Year 3. Complete this question by entering your answers in the tabs below. Req 1A Req 1B Prepare an income statement for Year 1, Year 2, and Year 3. O'Brien Company Variable Costing Income Statement Year 1 Year 2 Year 3 Variable expenses