Kitty Limited plans to manufacture bar fridges. According to the 2020 budget conducted by management, budgeted sales are expected to be R10 000 000 with 5 000 units being produced. The companys direct material and direct labour costs are expected to be 5000 cents and 3500 cents per unit respectively. Whereas, the fixed factory overheads and fixed administrative expenses are budgeted at R450 000 and R200 000 respectively. Furthermore, management has decided that R150 should be paid to sales consultants as an incentive for each unit sold.

2.2 Calculate the break-even quantity