Using the information below, prepare profit statements for June and July using:

$($a$)$ marginal costing,

$($b$)$ absorption costing.

A company produces and sells one product only which sells for $50$ per unit. There were no stocks at the end of May and other information is as follows.

Standard cost per unit

Direct material $18$

Direct wages $4$

Variable production overhead $3$

Budgeted and actual costs per month

Fixed production overhead $99,000$

Fixed selling expenses $14,000$

Fixed administration expenses $26,000$

Variable selling expenses $10\%$ of sales value

Normal capacity is $11,000$ units per month.

The number of units produced and sold was:

June July

Units units

Sales $12,80011,000$

Production $14,00010,200$