Jaime Ltd manufactures and sells a small electric product to order for the computer industry. The estimated
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Question:
Variable costs:
Direct materials 216.00
Direct labour 108.00Production overhead 54.00
Selling & distribution overhead 27.00Jaime Ltd expects to sell 108,000 units next year.
Jaime Ltd expects the stock level at the start of the year to be NIL and the stock at the end of the year to be 18,000 units. Information on fixed costs is as follows:Fixed costs: £
Production overhead 1,452,000Selling & distribution 360,000
Administration overhead 342,000(a) Using absorption costing:
(i) Calculate the production cost per unit.
(ii) Prepare an income statement for the year. (8 marks)
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