S Exercise 6-6 (Algo) Variable and Absorption Costing Unit Product Costs and Income Statements [LO6-1, LO6-2] Lynch Company manufactures and sells a single product. The following costs were incurred during the company's first year of operations: 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 During the year, the company produced 33,000 units and sold 15,000 units. The selling price of the company's product is $52 per unit. Required: 1. Assume the company uses absorption costing: a. Compute the unit product cost. b. Prepare an income statement for the year. 2. Assume the company uses variable costing: a. Compute the unit product cost. b. Prepare an income statement for the year. $ 14 $5 $ 1 $ 1 $ 264,000 $ 174,000

Exercise 6-6 (Algo) Variable and Absorption Costing Unit Product Costs and Income Statements [LO6-1, LO6-2] Lynch Company manufactures and selis a single product. The following costs were incurred during the company's first year of operations: During the year, the company produced 33,000 units and sold 15,000 units. The selling price of the company's product is $52 per unit. Required: 1. Assume the company uses absorption costing: a. Compute the unit product cost. b. Prepare an income statement for the year. 2. Assume the company uses variable costing: a. Compute the unit product cost. b. Prepare an income statement for the year