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Tutorial 1 Question 1 (17 Marks - 31 Minutes) Supp 2013 Nov The following information was extracted from the accounting records of Ombiga CC, a manufacturer of portable organs, for the year ended 30 June 2012 and from the 2013 budget: Actual 2012 Units nil 300 260 Budget 2013 Units ? 310 300 Completed inventory at the beginning of the year Production for the year Sales for the year N$ N$ 18 000 19 000 Selling price per unit Variable cost per unit: Production: Direct material Direct labour Manufacturing overheads Total production cost per unit 4600 4 400 2 000 1 600 1 200 7 400 1 100 7 500 Variable selling and administration costs per unit 1 000 900 Fixed production costs Fixed selling and administration costs 390 000 136 000 418 500 130 000 There were no losses during the 2012 year and no provision for losses is made for 2013. The company uses the weighted average method for the valuation of inventory. MARKS REQUIRED: Prepare the following reports for 2013: 1.1 The income statement according to the direct costing method 1.2 The income statement according to the absorption costing method 1.3 Reconcile the difference in profits according to the two methods 8 6 3 Page 2 of 71