Required information Problem 6-1A Variable costing income statement and conversion to absorption costing income (two consecutive years) LO P2, P3 [The following information applies to the questions displayed below.] Dowell Company produces a single product. Its income statements under absorption costing for its first two years of operation follow. 2016 2017 Sales ($44 per unit) Cost of goods sold ($29 per unit) oross margin Selling and administrative expenses Net income $1,056,000 $1,936,000 696,000 1,276,000 660,00e 322,000 338,000 360,000 287,008 $ 73,000 $ Additional Information a. Sales and production data for these first two years follow 2016 34,000 34,000 24,000 44,000 2017 Units produced Units sold b. Variable cost per unit and total fixed costs are unchanged during 2016 and 2017. The company's $29 per unit product cost consists of the following Direct materials Direct labor Variable overhead Fixed overhead ($340,000/34,000 units) Total product cost per unit 4 7 c. Selling and administrative expenses consist of the following. Variable selling and administrative expenses ($1.75 per unit) Fixed selling and administrative expenses Total selling and administrative expenses 2016 2017 $42,000 77,000 245,000 245,90 $287,000 $322,000 Problem 6-1A Part 1 1. Complete income statements for the company for each of its first two years under variable costing. (Loss amounts should be entered with a minus sign.) DOWELL Company Variable Costing Income Statements 2016 2017 Net income (loss)