Q1. Bayblo has incurred the following costs to make 200,000 units during the month of December. Rials Materials 500,000 Direct labor 200,000 Variable manufacturing overhead 60,000 Variable selling and administrative costs 90,000 Fixed manufacturing overhead 400,000 Fixed selling and administrative costs 400,000 Bayblos December 1st inventory consisted of 20,000 units valued at RIALS 116,000 using absorption costing. Total fixed costs and variable costs per unit have not changed during the past few months. In December, Bayblo sold 210,000 units at RIALS 20 per unit.

REQUIRED: 1. Using absorption costing, calculate the following.

a. Bayblos December manufacturing cost per unit

b. Bayblos December 30 inventory value c. Bayblos December net income.

2. Using variable costing, calculate the following.

a. Bayblos December manufacturing cost per unit.

b. Bayblos December 30 inventory value. c. Bayblos December net income.

3. Identify and explain the reason/s why the income calculated in the previous two questions might differ.