The Dean Company produces and sells a single product. The following data refer to the year just completed: 

Selling price $450          

Units in beginning Inventory    0

Units produced                     25,000

Units sold                            22,000

Variable costs per unit:

Direct materials                   $   200 

Direct labor                         $    50 

Variable manufacturing overhead    $   30 

Variable selling and admin          $  15 

Fixed Costs:

Fixed manufacturing overhead      $  275,000 

Fixed selling and admin                 $  230,000 

Assume that direct labor is a variable cost.

Required:

a. Compute the cost of a single unit of product 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.