Aladdin Ltd makes teddy bears. Because the number of sales is uncertain the accountant has produced figures for three different levels of production. Each teddy bear will sell for 13. Budgeted sales (units) 10,000 15,000 20,000 Direct materials per unit 3 3 3 Direct labour per unit 4 4 4 Production overheads 56,000 56,000 56,000 Selling & distribution 28,000 28,000 28,000 overheads Required: a) Calculate the profit or loss at each level of production. [8 Marks] b) Calculate the break-even point in value. c) Advise as to which level of production should be used. d) Market research suggests that the business can only sell 21,000 teddy bears. This level of production would require larger premises at an additional rent of 45,000. Assuming 21,000 bears could be sold. Advise Aladdin Ltd as to whether this expansion would be a good idea. [3 Marks] [2 Marks] [4 Marks] e) Calculate the number of sales units required to achieve a target profit of 36,000. [3 Marks] f) Define a cash budget and briefly discuss the advantages of preparing a cash budget. [5 Marks]