Q. No. 3 Max Marks - 07 ABSORPTION AND DIRECT COSTING ZEE Company produces and sells a single type of recreational equipment. One of the company's camp store s ells each equipment at Rs. 900. The company produced 40,000 units and sold 35,000 units in the month of Jun e - 2020. There are no opening and closing f hished goods inventories. Cost of direct material, direct labor and variable manufacturing expenses for producing each unit are Rs. 200, Rs. 150 and Rs. 300 respectively. Followi ng expenses are also associated for the month of June: Fixed Manufacturing expenses for each unit produced Rs. 25 Fixed Marketing and Selling expenses Rs 200,000 Fixed Administrative expenses Rs. 350,000 Variable marketing and selling expenses for each unit sold 4 Variable Administrative expenses Rs. 250,000 Required: a Prepare operating income statement under both, Absorption and Variable Costing Approach. (5- Marks) b. Explain the reason of any difference in operating net profit under both approaches. (2 - Mark)