AB Lid.; manufactures three products X,Y and Z. Standard selling process and costs have been establiehed for 1985 as follows: Direct wages are paid at the rate of Rs 2-per hour in each case. Fixed overneags are uungund at Rs 25.000 for the comirig year. In the short runithe company cannot increase its direct labour strength and as a result, only 35000 direct labour hours will be available in the coming year. The company has commitments to produce 500 units of each product. It has been suggested that after meeting the minimum requirements for X,Y and Z, the balance of available direct labour hours should be used to produce product Z. You are required: (a) To prepare an income statement showing the expected results if the proposal is adopted. (b) Comment on the statement you have produced in (a) and prepare an income statement for any alternative policy which you consider would be more profitable. (c) Basing your calculations on your suggestion in (b), show the company's break-even point in tetms of units and sales value. (d) Show the sale value which is required to produce an after tax return of 10% on capital employed of Rs 1,00,000 assuming tax rate of 50%