Anagram Ltd is in the manufacturing business; the organisation maintains a variable cost accounting statement for its internal purpose, which helps them take financial decisions and with financial planning. During the financial year 202021, the organisation has made total sales of 900,000, from sales of 4,000 units. The cost details are as follows:

Amount ()

Cost of Materials Purchases 150,000

Labour cost 120,000

Production Overheads 200,000

Sales Overheads 100,000

Rent 140,000

Fixed Salaries 310,000

Repairs 30,000

Interest Cost 40,000

30% of production overheads are fixed in nature and 25% of variable overheads are fixed in the nature.

Required:

(a) Prepare the Variable Cost income statement for Anagram Ltd for the 2020-21 financial year.

(b) For the 2021-22 financial year, assume Anagram Ltds direct costs increase by 10% (the other variable costs per unit remain constant) and its fixed costs are expected to be 280,000. On the basis of the companys target profit margin of 15% on total cost, calculate the expected sales revenue for the year and expected selling price per unit if Anagram Ltd meets its sales target of 6,000 units.