Elite Cameras PLC produces high quality cameras. It has an excellent reputation but also has several competitors. Working with a focus group of professional photographers, it has developed a camera (the Snap Superior) incorporating the most advanced technology. The development of this camera is important to Elite Cameras PLC because sales of two of its older products are declining, so the capacity needed to make the Snap Superior will become available without the need to expand the workforce or machinery. Market research indicates an acceptable retail price of 1,500 per camera. The cameras would be sold through specialist camera retailers who would expect to make a profit of 25% on cost price. Elite Cameras PLC plans to make a profit on each camera of 30% of selling price to the retailer. It is expected that 300,000 units will be made. The costs of making the Snap Superior cameras are been estimated as: Bought in parts 400 per unit. Material for casings 80 grams needed per camera but a 2% wastage is expected. Cost of material 8 per kilo. Direct labour 6 hours @ 25. Direct machining uses 3 hours for each camera. Machine time charged to products on the basis of 40 per direct machine hour. This rate is expected to continue for the life of the Snap Superior production. Factory overhead is based direct labour hours and allocated on the basis of 20 per direct labour hour. Ordering and receiving costs are 200 per purchase order. Parts come from 30 suppliers for each camera and are delivered regularly to supply parts for batches of 1,000 units. Quality assurance and rework 12 per inspection. Each camera requires 5 inspections at different stages. Due to the nature of the work, errors will be rectified by the inspectors. Research and design of the Snap Superior 9,000,000. Marketing for the Snap Superior 6,000,000. Distribution 20 per camera. Warranty and after sales service 25 per camera. . Required: a) Calculate: i) The target cost of the Snap Superior Camera. ii) The estimated cost of the Snap Superior Camera as detailed above. (2 marks) (8 marks) b) 7/14 ion As a result of the calculation of estimated cost, the company has taken the follow Obtained a reduction of bought in parts by 50 per camera by reviewing of the parts and reducing the number of suppliers to 24. Reviewed the labour process and brought the time needed down to 4 hours Machining costs can be made more efficient and reduced to 2.5 hours per unit Distribution can be reduced to 15 per unit by using a different courier. Calculate the new estimated cost. . (6 marks) c) Based on the information provided and your answers to parts a) and b) above, advise the company on whether to proceed with the Snap Superior Camera. (4 marks)