The table below presents a summary of the sales and cost figures for the first two years of operation of HKUKs France division:

Selling price per unit of soap

100

Manufacturing Costs per unit:

Direct Material A

Direct Labour B

Variable Overhead C

Fixed manufacturing cost per year

240,000

Selling and Administrative costs:

Variable selling and administrative costs per unit 10

Fixed selling and administrative costs per year 140,000

2019

2020

Units in beginning stock 0 4,000

Units produced during the year 20,000 12,000

Units sold during the year 16,000 16,000

Required: a) Determine for each of the two years, the unit product cost under variable and absorption costing. b) Prepare a profit and loss account for 2019, 2020 using variable costing and Absorption Costing Where, A=22 B=10 C=8