Khan Ltd can render three different types of service (Alpha, Beta and Gamma) using the same staff. Various estimates for next year have been made as follows: Service Alpha Beta Gamma Selling price (/unit) 30 39 20 Variable material cost (/unit) 15 18 10 Other variable costs (/unit) 6 10 5 Share of fixed cost (/unit) 8 12 4 Staff time required (hours) 2 3 1 Fixed cost for next year is expected to total 40,000. Required: (a) If the business were to render only service Alpha next year, how many units of the service would it need to provide in order to break even? (Assume for this part of the question that there is no effective limit to market size and staffing level.) (b) If the business has limited staff hours available next year, in which order of preference would the three services come? (c) The maximum market for next year for the three services is as follows: Alpha 3,000 units Beta 2,000 units Gamma 5,000 units Khan Ltd has a maximum of 10,000 staff hours available next year. What quantities of each service should the business provide next year and how much profit would this be expected to yield? The solution to this question can be found at the back of the book on pp. 522-523