Biotech Ltd produces memory discs at its factory. The following information relates to the production of memory discs for the period ending 31 March 2020.

	Production		Sales
	(Units)		(Units)
Budget	90,000		87,000
Actual	96,000		93,000
	Variable Prod.		Fixed Prod.			Fixed Selling
	Cost		Overhead			Overhead
	$		$			$
Budget	4,500,000		900,000			675,000
Actual	4,800,000		937,500			675,000

The fixed production overhead was absorbed at a pre-determined rate per unit produced. One memory disc was sold for $130. At the beginning of April 2019, there was opening inventory of 5,250 units valued at $315,000; this includes fixed production overhead of $52,500.

Required:

a. Prepare a marginal costing income statement for the company.	[3 marks]
b. Prepare an absorption costing income statement for the company.	[8 marks]
c. Reconcile the income under both statements.	[2 marks]