Harper Ltd is a manufacturer of rowing boats. It has designed a new boat called the Seafarer and expects to produce the Seafarer in a continuous operation over an 18 month period During this period, it is expected that a total of sixteen Seafarer's will be produced and sold. The production of the Seafarer is a labour intensive operation and units are produced one after another The costs of producing the first Seafarer are as follows Skilled Labour 1,000 hours at a rate of 40 per hour Unskilled Labour 2,000 hours at a rate of 20 per hour Materials 25,000 Overheads - 20 per labour hour worked (total of Skilled and Unskilled labour hours) It is known that in producing any product, Skilled Labour usage experiences a 75% learning curve effect and Unskilled Labour usage experiences a 80% learning curve effect. Harper Ltd has decided to set the selling price per unit of the Seafarer by using the full cost plus method of pricing, with a profit mark up of 20% Required (a) Using the cumulative average time model, calculate the minimum selling price of (i) the first unit of the Seafarer (ii) the second unit of the Seafarer (iii) the first 16 units of the Seafarer if ordered together (35 marks) (b) Identify the method of setting the selling price that Harper Ltd has chosen Explain how the learning curve model will affect the calculations for that selling price (10 marks) (c) Harper Ltd also produce a further rowing boat, the Rower, which has been in production for a number of years, and to date 352 units of the Rower have been produced. The budget for the next quarter is showing the production of 50 units of the Rower. If the 1st ever unit took 100 hours and an 80% learning curve applies (i) calculate the total labours hours needed for the production of the 50 units of the Rower (ii) calculate the average labour time per unit (ii) explain where this information may be used by Harper Ltd Note: the learning co-efficient of 80% is-0322 (15 marks)