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The chief executive officer Richards Corp. attended a conference in wich one of the sessions was devoted to variable costing. The CEO was impressed by the presentation and has asked that the following data of Richards corp. be used to prepare comparative statements using variable costing and the company's absorption costing. The data follow:
-Direct materials $90,000-Direct Labor $120,000-Variable factory overhead $60,000-Fixed factory overhead $ 150,000-Fixed marketing & Admin Expense $180,000
The factory produced 80,000 units during the period, and 70,000 units were sold for $700,000
1 - Prepare an income statement using variable costing
2 - Prepare an income statement using absorption costing
*Round unit cost to three decimal places*
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