Absorption costing (over- and under absorbtion) Marginal costing X plc produces one product - cupboards. Each cupboard is budgeted to require 4 kg of timber at 3 hours of labour at and variable production overheads of Fixed production overheads are budgeted at average production/sales is estimated to be The selling price is fixed at There is also a variable selling cost of During the first two months X plc had the following levels of activity: January units 2 $ per kg, 3 $ per hour, 4 $ per unit. 2 handles 0,5 $ per each, 40 000 10 000 $ per month and units per month. 40 $ per unit. 1 $ per unit and fixed selling cost of 4 000 $ per month. February units Production Sales 9 000 12 000 11 500 12 500 Actual selling price $ 43 39 Fixed selling cost of 5 500 3 500 $ per month. (a)Prepare a cost card using absorption and marginal costing. (b)Set out Actual Income Statements for the months of January and February, using i) absorption costing ii) marginal costing !!! See templates from slides. Adjust for over-uner-absorption (under absorption costing). c) Compare net profit (MC vs AC) and make a conclusion d) make a variance analysis for Jan/Feb see YOUR task to understand the month of analysis,