The following information given in the table is available for Lion Limited, the manufacturer of

Super Cool shirts.

R

Sales price per unit 12.50

Variable production cost per unit 7.50

Variable administration sales and distribution per unit 1.00

Fixed production costs 37 500

Fixed administration sales and distribution 18 750

Opening stock in units 2 500

Units produced 25 000

At the beginning of December 2017 there were 2 500 units in inventory

Assuming the 3 different levels of sales for the month of December:

(a) 12 500 units

(b) 18 750 units

(c) 25 000 units

Required:

2.1 Draw up a statement of comprehensive income according to marginal costing

principles (13)

2.2 Draw up a statement of comprehensive income according to absorption costing

principles (13)

2.3 Reconcile the profits (4)