Polk Company

Polk Company builds custom fishing lures for sporting goods stores. In its first year of operations, 2012, the company incurred the following costs.Variable Cost per Unit Direct materials $8.10Direct labor $2.65Variable manufacturing overhead $6.21Variable selling and administrative expenses $4.21 Fixed Costs per Year Fixed manufacturing overhead $254,184Fixed selling and administrative expenses $259,308Polk Company sells the fishing lures for $27.00. During 2012, the company sold 80,300 lures and produced 95,200 lures.Instructions(a) Assuming the company uses variable costing, calculate Polk’s manufacturing cost per unit for 2012.(b) Prepare a variable costing income statement for 2012.(c) Assuming the company uses absorption costing, calculate Polk’s manufacturing cost per unit for 2012.(d) Prepare an absorption costing income statement for 2012.