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1 Santana Rey expects sales of Business Solutions's line of computer workstation furniture to equal 300 workstations (at a sales price of $3,000 each) for 2019. The workstations' manufacturing costs include the following Direct materials Direct labor Variable overhead Fixed overhead 5 790 per unit $ 400 per unit $ se per unit $19,200 per year The selling expenses related to these workstations follow Variable selling expenses Fixed selling expenses 45 per unit $4,000 per year Santana is considering how many workstations to produce in 2019. She is confident that she will be able to sell any workstations in her 2019 ending inventory during 2020 However, Santana does not want to overproduce as she does not have sufficient storage space for many more workstations Required: 1. Complete the following income statements using absorption costing 2. Complete the following income statements using variable costing 1 Cost of goods sold: Direct materials per unit Direct labor per unit Variable overhead per unit Fixed overhead pernik Cost of goods sold per unit Number of workstations sold Total cost of goods sold Production volume 300 320 workstations workstations $ 790 5 790 400 400 80 80 64 69 1334 $ 1,339 300 300 400 2005 401.700 BUSINESS SOLUTIONS Absorption conting Income Statements Production volume Sales volume 300 Workstations 300 320 wa ations workstations 900.000$ 900 000 Co old 10000 (407.700 Oro 499.000 498 300 Wand come 39000 490300 Underten Volume and und 320 workstations 300 workstations BUSINESS SOLUTIONS Variable Costing Income Statements 300 Production volume (units) workstations 300 Sales volume (units) workstations Sales Less Variable costs Direct materials Direct labor Variable overhead Variable selling expenses 0 0 Contribution margin Less Fixed expenses Fixed overhead costs Fixed selling expenses Net Income (ons) S $ 0 Under variable costing can company increase its net income by increasing production NO

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