Solution-Prepare income statements under marginal

Prepare income statements under marginal

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Reference no: EM132522108

Cloud Ltd., produces 8,000 units of product Z during the year ended 31/12/2018. 6,000 of these units were sold at sh6 per unit. The production costs were as follows:

Direct Materials???sh0.50 per unit

Direct Labour ???? sh0.80 per unit

Variable Overhead ??? sh0.50 per unit

Fixed Overhead Cost for the year ? sh3,000

You are required to:

Question (a) Prepare income statements under Marginal and Absorption costing principles.

Question (b) Outline the differences between Marginal and Absorption costing. Indicate which method should be used for financial accounting purposes and why. ????

Reference no: EM132522108

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Prepare income statements under marginal

Reference no: EM132522108

Reference no: EM132522108

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