Item1 10 points eBook HintPrintReferences Check my work Check My Work button is now enabledItem 1Item 1 10 points 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 $ 12 Direct labor $ 6 Variable manufacturing overhead $ 1 Variable selling and administrative $ 1 Fixed costs per year: Fixed manufacturing overhead $ 308,000 Fixed selling and administrative $ 218,000 During the year, the company produced 28,000 units and sold 15,000 units. The selling price of the company’s product is $56 per unit. Required: 1. Assume that the company uses absorption costing: a. Compute the unit product cost. b. Prepare an income statement for the year. 2. Assume that the company uses variable costing: a. Compute the unit product cost. b. Prepare an income statement for the year.