The Hind General Corporation Ltd produces a product, which has the following costs: Variable manufacturing costs: `4 per unit Fixed manufacturing costs: `2,00,000 per year The normal capacity is set...

The Hind General Corporation Ltd produces a product, which has the following costs: Variable manufacturing costs: `4 per unit Fixed manufacturing costs: `2,00,000 per year The normal capacity is set at 2,00,000 units There are no work-in-process inventories Last year, the company produced 2,00,000 units and sold 90 per cent at a price of `7 per unit. In the current year, the company produced 2,10,000 units and sold 2,15,000 units at the same price. Prepare income statement for both the years based on (a) absorption costing, and (b) variable costing.