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1. Enusah Motors Limited assembles and sells motor vehicles. It uses an actual costing system, in which unit costs are calculated on a monthly basis.
1. Enusah Motors Limited assembles and sells motor vehicles. It uses an actual costing system, in which unit costs are calculated on a monthly basis. The selling price per motor vehicle is $44,000. Data relating to January, February and March of 2020 are: January February March Unit data: Production (units) Sales (units) Variable-cost data: 1000 1000 900 900 1040 940 100 60 20 Manufacturing costs per unit produced Selling and Admin costs per unit sold Fixed-cost data Manufacturing costs Selling and Admin costs Required: 16,000 8,000 16,000 8,000 16,000 8,000 2,400,000 2,400,000 2,400,000 $1,600,000 $1,600,000 $1,600,000 i. Compute the product cost per unit under both variable and absorption costing methods ii. Present income statements for Enusah Motors in January, February and March of 2020 under a. Variable costing b. Absorption costing. iii. Reconcile and explain the differences in operating profits under both costing methods
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