$($a$)$

Calculate the unit product cost for a pair of sneakers manufactured by Rocco $($Pty$)$ Ltd for each of the two quarters and comment on the gross profit margin generated.

$($b$)$

Prepare the income statement of Rocco $($Pty$)$ Ltd for the second quarter ending $30$ June $2018$ using the variable costing system.

$($c$)$

Prepare the reconciliation between the profit calculated using the absorption costing method $($as presented in the previous page$)$ and that calculated using variable costing method for the second quarter ending $30$ June $2018.$

$($d$)$

Assist the management committee in analysing the decline in the profitability of the company for the second quarter ending $30$ June $2018.$ Include the comparison of profits for the first and second quarters under both methods.

$($e$)$

Calculate the break$-$even units $($pairs of sneakers$)$ of Rocco $($Pty$)$ Ltd and indicate the margin of safety units which the company would have for the third quarter of $2018.$

$($f$)$

Indicate, with reasons, whether you agree with the chief operations officer$$s comment made in the recent management committee meeting.

$($g$)$

Calculate a net cash movement to be presented in the cash budget for Rocco $($Pty$)$ Ltd for the last two quarters of the $2018$ financial year $($quarter $3$ and $4).$