Reference no: EM132549684

Solo limited makes and sells a single product.The following data relate to period 1 to 4.

Variable cost per unit is sh 30

Selling price per unit is sh55

Fixed cost per period sh 6000

Normal activity is 500units and production and sales for the four periods are as follows.

Period 1 sales 500 and production 500, period 2 sales 400 production 500,period 3 sales 550 production 450,period 4 sales 450 production 500.

There were no opening stocks at the start of period 1

Required:

Question 1. Prepare operating statements for each of the periods 1 to 4 using marginal costing principles.

Question 2. prepare operating statements for each of the periods 1 to 4 based on absorption costing principles.

Question 3. comment on the results in each period