A factory can produce 60,000 units per annum at its optimum (100%) capacity. The estimated cost of production are as follows: Direct material Direct labour Indirect expenses: Fixed Rs. 3 per unit Rs. 2 per unit Rs. 1,50,000 per annum Variable Semi variable Rs. 5 per unit Rs. 50,000 per annum up to 50% capacity and an extra expense of Rs. 10,000 for every 25% increase in capacity or part thereof. The factory produces only against orders (and not for own stock). I If the production program of the factory is as indicated below and the management desires to ensure a profit of Rs. 1,00,000 for the year, work out the average selling price at which each unit should be quoted. First 3 months of the year: 50% capacity, remaining 9 months 80% of capacity. Ignore selling and distribution and administrative overheads.