Question: It's a full question QUESTION 3 The following data have been extracted from the budgets and standard costs of FAA Limited a company which manufactures

It's a full question QUESTION 3 The following data have been

It's a full question

QUESTION 3 The following data have been extracted from the budgets and standard costs of FAA Limited a company which manufactures and sells a single product, for the 1st quarter of 2021. GHe per unit Selling price 60 Direct material 15 Direct labour 10 Variable production overhead 5 Fixed production overhead costs are budgeted at GH 700,000 per annum. Normal production levels are thought to be 350,000 units per annum. Selling and distribution expenses are: Fixed GH 20,000 per month Variable 5% of the sales value Administration costs are GH 200,000 per annum. The following trends of sales and production are expected during the first quarter of 2021 Units Production 80,000 Sales 70,000 There were no opening inventories. REQUIRED: a) Prepare the absorption costing and marginal costing income statements for 1st quarter, 2021 b) Reconcile the profits in (a) above 2 c) State two (2) differences between absorption costing and marginal costing approaches d) What is the meaning of slack under limiting factor analysis? 2/10

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