Dowell Company produces a single product. Its income statements under absorption costing for its first two years of operation follow. 2014 2015
Sales ($46 per unit) $1,104,000 $2,024,000
Cost of goods sold ($31 per unit) 744,000 1,364,000
Gross margin 360,000 660,000
Selling and administrative expenses 293,000 333,000
Net income $67,000 $327,000

Additional Information

a. Sales and production data for these first two years follow.

2014 2015
Units produced 34,000 34,000
Units sold 24,000 44,000

b. Variable cost per unit and total fixed costs are unchanged during 2014 and 2015. The company's $31 per unit product cost consists of the following.

Direct materials $5
Direct labor 8
Variable overhead 8

Fixed overhead ($340,000/34,000 units) 10
Total product cost per unit $31

c. Selling and administrative expenses consist of the following.

2014 2015
Variable selling and administrative expenses ($2 per unit) $48,000 $88,000
Fixed selling and administrative expenses 245,000 245,000
Total selling and administrative expenses $293,000 $333,000

Requried:
a. Complete income statements for the company for each of its first two years under variable costing.(Loss amounts should be entered with a minus sign.)
b. What are the differences between the absorption costing income and the variable costing income for these two years?