A product sells at Rs$.3$ per unit. The company uses a first$-$in$-$out actual costing

system. A new fixed manufacturing overhead allocation rate is computed each year by

dividing the actual fixed manufacturing overhead cost by the actual production. The

following data is available for the first two years:

Year $1$ Year $2$

Sales $($Units$)15001800$

Production $($Units$)21001500$

Cost: $($Rs$.)($Rs$.)$

Variable Manufacturing $1050750$

Fixed Manufacturing $10501050$

Variable Marketing and Administration $15001800$

Fixed Marketing and Administration $600600$

Prepare Income Statement for each year based on:

a$.$ Absorption Costing $(5$ Marks$)$

b$.$ Variable Costing $(5$ Marks$)$