QUESTION $2$

REQUIRED

$2\mathrm{.}1$ Use the information provided below to prepare the Income Statement of Turbo Manufacturers for the month ended $31$ August $2024$ using the following methods:

$2\mathrm{.}1\mathrm{.}1$ Variable costing.

$(9$ marks$)$

$2\mathrm{.}1\mathrm{.}2$ Absorption costing.

$2\mathrm{.}2$ Reconcile the profit calculated according to variable costing $($in question $2\mathrm{.}1\mathrm{.}1)$ with the profit calculated according to absorption costing $($in question $2\mathrm{.}1\mathrm{.}2).$ Your answer must include the calculation of the fixed manufacturing costs in inventory.

INFORMATION

The following information relates to the only product produced by Turbo Manufacturers for the month ended $31$ August $2024$: