QUESTION 5 (24 marks; 43.2 minutes) Grunewald Company manufactures a professional grade vacuum cleaner and began operations in 2018. For 2018, Grunewald budgeted to produce and sell 50 000 units and this objective was achieved. The company writes off production volume variance to cost of goods sold. Actual data for 2018 are given as follows Units produced Units sold Selling price 50 000 44 800 R1 200 Variable costs: Manufacturing cost per unit produced: Direct materials Direct manufacturing labour Manufacturing overhead R55 R45 R120 Marketing cost per unit sold R75 R7 358 400 R4 905 600 Fixed costs: Manufacturing costs Administrative costs Marketing R15 622 400 Required: 5.1 Prepare an income statement using absorption costing. 5.2 Prepare an income statement using variable costing. (10) (10) 5.3 Reconcile the profits. (4)