2. One of the company's perfumers has created a new fragrance and the company is studying the production and marketing of this innovation on a large scale. The company will rent a factory for 16,000 riyals per month for production purposes. This manufacturer already took an advanced course in perfume composition to help him create fragrances. The course cost was 15,000 riyals. The company will pay a bill for renting and insuring the production equipment at a monthly cost of 8,000 riyals. The manufacturer estimated the following costs: The cost of direct materials for the unit will be 25 riyals, and the cost of hired direct labor will be 20 riyals per unit. He said that he will spend his time promoting the perfume, which will cost 12,600 riyals per month. In addition, 20,000 riyals from the current sales manager's salary were allocated to start the production of this fragrance. You are required to classify the costs related to producing this fragrance by completing the table below by placing an "X" under each heading that corresponds to the cost component. A cost element may be classified under more than one classification, and thus there may be more than "X" for each cost component. In this case, the cost classifications may contain more than one cost element, in which case these cost classifications may contain more than one "X". For example, a cost component may be sunk cost and at the same time indirect industrial cost, and thus there will be more than an "X" under each of these classifications under the same cost component. Differential cost Sunk cost Fixed cost Variable cost Sales and administrative cost Indirect production costs Direct production cost Factory rent The cost of the perfume manufacturing course Rent and insurance of equipment Material cost Labor cost Sales manager salary Promotion/marketing cost 3- What are the reasons or concepts behind your classifications in Requirement No. (2)? Justify your answers. 4- Suppose that the company will produce 16,000 bottles of perfume, according to the information listed in Requirement No. (2). You are required to calculate the following values and write the equations clearly in the report: 4.1 What is the value of the total conversion cost? Show your answer steps 4.2 What is the value of the total cost of production? Show your answer steps 4.3 What is the value of the total costs for the period? Show your answer steps