A company expects to have spare capacity of 1,500 direct labour hours over the next two months. It is considering two options in order to utilise the spare capacity. If the available hours are not utilised direct labour costs would not be incurred. Option 1: this involves bringing forward the manufacture of a firm future order which would, as a result, reduce the currently anticipated need for overtime working in a few months' time. The overtime premium is 25% of the basic rate of 6 per hour and is charged to production as a direct cost. Overheads are charged at 10 per direct labour hour worked; 40% of overhead costs are variable with hours worked. Option 2alternatively the company has been asked to quote for a one-off job to be completed over the next two months, this would require the following resources: Raw Materials: 880 kg of Material A: this is used continuously, has a current weighted average cost in stock of 4.50 per kg and a replacement cost of 6.50 per kg. ii) 750 kg of Material B: this is in stock at 10.50 and has a current replacement cost of 11.70 per kg. If Material B was used then this would not be replaced. It has no other anticipated use, other than scrap value for 5.20 per kg. 600 kg of material C: this is in stock valued at 5 per kg. It is in stock due to overbuying and has no alternative use. This could be used on another job in place of material X which is regularly used and costs 6 per kg iv) Other materials costing 6,000. i) Direct labour: 1,900 hours. You are required to: a) Determine the minimum quote, giving reasons, that could be tendered for the one-off job such that it would increase the company's profit, compared with the alternative use of spare capacity b) Explain the following terms: Sunk cost ii) Opportunity cost. Incremental cost i)