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Each monthly Straight Sewing Ltd manufacturers 100 sewing machines. The following table summarize the cost: 4,000 in materials Labour costs 5,000 Overhead production expenditures 5,000
Each monthly Straight Sewing Ltd manufacturers 100 sewing machines. The following table summarize the cost: 4,000 in materials Labour costs 5,000 Overhead production expenditures 5,000 (of which 2,000 is fixed costs) The firm sells each Sewing machines for 200.
(i) The Directors of Straight Sewing Ltd have requested that you determine the cost per unit of Sewing machine using both Marginal and absorption costing methods. (6 marks)
(ii) Prepare the profit or loss statement for the month using both methods.(4marks)
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