The following information relates to Vice Versa Ventures for calendar year 20XX, the company's first year of operations:
- Units produced 20,000
- Units sold 17,000
- Selling price per unit $35
- Direct material per unit $5
- Direct labor per unit $5
- Variable manufacturing overhead per unit $2
- Variable selling cost per unit $3
- Annual fixed manufacturing overhead $160,000
- Annual fixed selling and administrative expense $80,000
(a) Prepare an income statement using full costing.
(b) Prepare an income statement using variable costing.