Randy Company has obtained the following data for the first year of operations:

Sales RM2,868,750

Direct materials and labor RM1,125,000

Variable manufacturing overhead RM431,250

Fixed manufacturing overhead RM656,250

Variable selling expenses RM337,500

Fixed selling expenses RM131,250

Units produced 125,000

Units sold 112,500

Units expected to be produced 125,000

Required:

i) Using variable costing, prepare an income statement for the first year of operations. Assume budgeted fixed costs were equal to actual fixed costs.

ii) Using absorption costing, prepare an income statement for the first year of operations. Assume budgeted fixed costs were equal to actual fixed costs.