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Bharat Bicycle, located in India, produces an inexpensive yet rugged bicycle for use on crowded city streets. The company sells the bicycle for 700 rupees. (Indian currency is denominated in rupees, denoted by R.) Selected data for the company's operations last year follow: Units in beginning inventory 19,800 Units produced Units sold 17,400 Units in ending inventory 2,400 Variable costs per unit: Direct materials 198 208 Direct labour Variable manufacturing overhead R 88 Variable selling and administrative R 25 Fixed costs: R1,326,600 Fixed manufacturing overhead R 884,400 Fixed selling and administrative An absorption costing income statement prepared by the company's accountant appears below: R11,484,000 Sales (17,400 units x R660 per unit) Cost of goods sold: Beginning inventory Add: cost of goods manufactured (19,800 units x R per unit) 11,107,800 Goods available for sale 11,107,800 Less: ending inventory 1,346.400 9,761,400 (2,400 units x R per unit) Gross margin 1,722,600 Selling and administrative expenses: Variable selling and administrative 435,000 884,400 1,319,400 Fixed selling and administrative 403,200 Operating income R