QUESTION 9 A company which has been in existence for several years manufactures a single product with a unit selling price of GH34. Production and sales volumes of the product over a three month period have been: Month 1 2 3 Production (units) 12,000 10,500 10,000 Sales (units) 12,000 10,000 10,500 Total production cost per unit over the three month period was GH23.75, GH25 and GH25.50 respectively. Variable production costs per unit and fixed production costs per month were the same throughout the period. Selling and administrative overheads totaled GH87,000 in ch month. (a) Calculate the variable production cost per unit and fixed production cost per month, over the three month period. (b) Estimate the total cost that would be incurred in month 4 if 12,500 units are manufactured. (c) Prepare a profit statement for month 2 using the absorption costing method. Assume that the fixed production overheads absorption rate is based upon normal production of 12,000 units per month. (d) Prepare a profit statement for month 3 using the marginal costing method. (e) Explain with supporting figures, the profit difference in month 2 if the marginal costing method had been used instead of the absorption costing method