There is no inventory on hand at the beginning of the month of April for Leeds Limited. The total expected production and sales are 75 000 units and 70 000 units respectively. The selling price per unit is R12. The company’s expenses can be broken down as follows: 1 Fixed manufacturing cost is R34 500, 2 Variable manufacturing cost per unit is R3.30, 3 Fixed sales and administration costs are R32 000, and 4 Variable sales and administration costs are R1.45. Leeds limited uses the First-In-First out method of inventory evaluation. REQUIRED: Using the information provided above, prepare the Income statement of Leeds Limited for the month ended 30 April 2021 using: 1.1 The Absorption costing method 1.2 The Marginal costing method

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A:

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A:

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Inventory Accounting

Inventory accounting is that branch of accounting that helps in determining the specific value of assets at different stages of production and development.