Question 5 GLOVERS is the major supplier of gloves for local markets. During the financial year that ended 31 December 2021, the following information was extracted: Detailed balance of finished goods inventory of gloves: 1 January 2021 31 December 2021 2,000 As planned, the factory produced 20,000 units of gloves during the year. The variable manufacturing cost incurred were: direct material cost were RM8 per unit, direct labour cost were RM12 per unit and variable manufacturing overhead were RM7 per unit total The selling and administrative expenses incurred during the year were: variable selling, and administrative expense were RM3 per unit Fixed cost totaled RM 1,900,000 with 40% is related to selling and administrative All of the gloves are sold for RM180 per unit. A total of 18,000 units were sold during the year You are required to prepare: a. A Profit & Loss Statement for the year ended 31 December 2021 using the variable costing format (6 marks) A Profit & Loss Statement for the year ended 31 December 2021 using the absorption costing format (6 marks) A statement of reconciliation of net profit between absorption costing and variable costing (4 marks) d. Briefly explain why GLOVERS would prepare profit & Loss statement using absorption costing. (4 marks) (Total: 20 marks) b