QUESTION $5[20]$

Leisure Golf clubs Limited manufactures and sells golf clubs. The cost accountant provides

you will the following information pertaining to the production and sale of golf clubs:

Production and sales information card for January $2024$

Details January $2024$

Units

Number of golf caddies produced $20000$

Sales $18000$

Rands

Variable production costs per unit $2500$

Variable administration costs per unit $150$

Variable Selling and distribution cost per unit $100$

Fixed manufacturing overheads $4000000$

Fixed selling and distribution costs $2500000$

Fixed administration costs $7000000$

Selling price per unit $4500$

Production and sales information for February $2022$

Details February $2024$

Units

Number of golf caddies produced $30000$

Sales $20000$

Rands

Variable production costs per unit $3000$

Variable administration costs per unit $150$

Variable selling and distribution costs per unit $100$

Fixed manufacturing overheads $4000000$

Fixed Selling and distribution costs $2500000$

Fixed administration costs $7000000$

Selling price per unit $4800$

Additional information

There was no opening inventory in January $2024$ month.

Variable selling and distribution costs vary in relation to sales units.

Variable administration costs vary in relation to units produced.

Due to inflationary issues and the scarcity of steel used to manufacture golf clubs, variable

costs per unit increased in the month of February $2022.$

REQUIRED

$1.$ Using the attached table, determine the profit of Leisure Gold Club Limited for each

month according to the variable cost approach, if the inventory is valued according to

first$-$in$-$first$-$out, FIFO method.

A$.$ Month of January $2024(10)$

B$.$ Month of February $2024(10)$