3 : 0 3.1 Batch level – Inspection costs (51 SUCH- $1 3X. $1 000) Customer level costs ($180.100) Profit before taxes Income taxes (33%) )f 7 Budgeted net profitb)$4.150 618,000 $157,150 551859.50 $105,290.50Sales Unit contribution (a) proportion (b) (a).(b) B1 553 45.05% 523.87 132 $113 32.43% $36.65 B3 $91 22.52% uga ei,hietl-a% erne unit coni 1ion ma r,itt ULUFixed manufacturing overhead $400.000 Fixed selling and administrative costs S320,000 Batch level – Inspection costs (SI 800+3) 350+61 000) $4,150 Customer level costs ($180.100) 518,000 Target profit bcforc taxes 5477,611.. Weighted-average unit contribution margin ULU Required sales to cam the after-tax profit (units): 15055$400 000 (Fixed manufacturing overhead) + $320 000 (Fixed selling and administrative costs) + $4 150 (Batch level Inspection costs) + 18 000 Customer level costs + before-tax profit $477 611.94/$81.02 = 15 055 units in 0.45/0.32/0.23 proportions.Please note: we need a reasonable format in part a, proper terms and complete workings.Question 3:Incremental cost if purchased: Purchase price (S7 x 50 000) S350,000 Lost sales conMbution margin 580.000 Equipment lease penalty S12,000 Quality Control (580.240 hours) S19.200Rental incomc S24.000 Net cost of purchasing: S437,200/50 000 =58.74 per unit total number of unitsIncremental cost if manufactured: Direct material ($325 000. 0.95) $308,750 Direct labour (4 000.550.1.1) $220,000 Variable manufacturing overhead (S300 000 • 40%) $120,000.0 Equipment leasing cost $40,000 Set-up costs $12,000 Quality control hours $9,600 Total: 5710,350/50 000 =S14.20 per unit total number of units It is cheaper for Archie Ltd 19 033+0+0+ F-50. As an analysis of all relevant cos. is required, we need to consider on-time delivery issues/close-down manufacturing in regional Victoria/Local job losses/reputational issues/social costs/mi a lit, costs.Note: a number of mm-lioancial “costs”.Question 4:B1 B2 Selling price per unit 300 325 Total variable costs: $205 $260
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