A ) A business makes three products A B and C . All three products require the use of two types of cutting machines and assembly machines. Estimates for the year include the following:

Product A B C

selling price 25 30 18

Sales demand (units ) 2,500 3,400 5,100

Material Costs ( $ per unit) 7 4 3

Variable production cost on cutting machine ( hours) 1.0 1.0 0.5

Time Required per unit on assembling machine (hours) 0.5 1.0 0.5

Fixed costs for the year are expected to cost $ 42,000. it is the business' policy for each unit of production to absorb these in proportion to its total variable costs. The business has cutting machine capacity of 5,000 hours a year and assembling machine capacity of 8,000 hours per year,

Required

a) State, with supporting workings , which products in which quantities the business should plan to make next year on the basis of the above information ( Hint first determine which machine will be a limiting factor ( scarce resource )

b) State the maximum price per product that it would be worth paying to a subcontractor to carry out that part of the work that could be done internally

c) Explain five(5) factors that may affect the dividend policy of a company