Full and Variable costing

Q$-1$

The Jarvis Company's Cost Department prepares annual income statements based on absorption

costing. Following information have been received from their accounting records for a single product

at the end of December $311^{st},2015$ :

Selling price of each single unit is Rs$.150.$

Required

i$.$ Prepare Comparative income statements for the year ended December ${31}^{st},2015($a$)$ the

absorption costing method and $($b$)$ the direct costing method.

ii$.$ An explanation of the difference, if any, in the operating income figures.