The Dorset Corporation produces and sells a single product.The following data refer to the year just completed: 
Assume that direct labor is a variable cost.
Required:
a.Compute the unit product cost under both the absorption costing and variable costing approaches.
b.Prepare an income statement for the year using absorption costing.
c.Prepare an income statement for the year using variable costing.
d.Reconcile the absorption costing and variable costing net operating income figures in (b)and (c)above.
Definitions:
Fuel-Efficient Cars
Automobiles designed to use less fuel for the same distance traveled, reducing environmental impact and saving costs.
SUVs
Sport Utility Vehicles are a class of motors designed for both on-road and off-road use, combining elements of passenger cars and off-road vehicles.
Focused Freewriting
A writing technique involving continuous writing without concern for grammar or topic constraints, aimed at increasing creativity and overcoming blocks.
Asking Questions
Asking questions involves the act of inquiring to gain information, clarify understanding, or solve problems.
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