QUESTION 1 [Absorption and Marginal Costing] (25 marks) Randburg Ltd manufactures a single product, and the following costs are incurred based on a planned production and sales of 11 500 litres in a month. Budgeted costs for the month were as follows. Prime manufacturing costs per litre Fixed production overhead per litre Variable Administration costs per litre Rand 104 56 13 34 Fixed Administration costs per litre Actual production and sales for the month were as follows. Production in litres Sales in litres 11 500 litres 11 400 litres(at R240 per litre There were no finished goods on hand at the beginning of the month. All other costs remained unchanged as per budget. Required a) Income statement for the company using the Absorption costing approach(10 marks) b) Income statement for the company using the Marginal costing approach (10 marks) c) Prepare a reconciliation of the profits calculated using the two approaches. (5 marks)