Lund Company sells a single product for $25. It had no beginning inventories. Operating data follow.
| Sales, 55,000 units | $1,375,000 |
| Normal capacity | 60,000 units |
| Production costs: | |
| Variable per unit | $13 |
| Fixed production | $300,000 |
| Selling and administrative expenses: | |
| Variable per unit sold | $2 |
| Fixed selling | $40,000 |
| Number of units produced | 66,000 units |
Assume the actual costs were as budgeted.
a. Compute income under standard variable costing.
b. Compute income under standard absorption costing.
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