a. Prepare an income statement using absorption costing. b. Prepare an income statement using variable costing

Bruster Company sells its products for $66 each. The current production level is 25,000

units, although only 20,000 units are anticipated to be sold.

Unit manufacturing costs are:

Direct materials $12.00

Direct manufacturing labor $18.00

Variable manufacturing costs $9.00

Total fixed manufacturing costs $180,000

Marketing expenses $6.00 per unit, plus $60,000 per year

Required:

a. Prepare an income statement using absorption costing.

b. Prepare an income statement using variable costing