Preparation of marginal and absorption costing profit statements and reconciliation profit statements. RH S/B makes and sell one product, the standard cost per unit is as follows: RM Direct labour 3 hours at RM6 per hour 18 Durect materials 4 kilograms at RM7 per kg 28 Production overhead : Variable Fixed 40 Totsl standard cost per unit 69 Normal output is 16, 000 units per annum and this figure is used for the fixed production overhead calculation. Costs relating to selling, distribution and administration are : Variable 20 per cent of sales value Fixed RM180,000 per annum The only variance is a fixed production overhead volume variance. There are no units in finished goods stock at 1 October 2020. The fixed overhead expenditure is spread evenly throughout the year. The selling price per unit is RM140. For the six monthly periods detailed below. the number of units to be produced and sold are budgeted as: Six months ending Six months ending 31 March 2021 30 September 2021 Production 8,500 7, 000 Sales 7,000 8,000 You are required(a) to prepare statements for management showing sales, costs and profits for each of the six-monthly periods, using (i) marginal costing, (6 marks) (ii )'absorption costing; (9 marks) (b) Prepare an explanatory statement reconciling for each six -monthly period the profit using marginal costing with profit using absorption costing; (4 marks) (c) to state and explain three business situations where the - of marginal costing may be beneficial to management making a decision. (6 marks) (Total 25 marks) CIMA past year