A cleaning company has a variable cost (Cv) of R 500.00 per standard service hour and they charge R530 per hour. With the current workforce, the company can provide 90000 hours of service per year. With a fixed cost of R1 700000 per year

(a) Calculate the breakeven point in standard service hours and in percentage of total capacity. (8) (b) Calculate what is the percentage reduction in the breakeven point (sensitivity) if fixed costs are reduced 10%; if variable cost per hour is reduced 10%; and if the selling price per unit is increased by 10% ?