MG Company manufacturers noodle making machine according to customer specifications. The company operated at 75 percent capacity during last year, with the following results (in thousands): Sales revenue RM10,000 (-) Sales commission (10%) (1,000) Net sales RM9,000 Costs: Direct materials RM2,400 Direct labor 3,000 Manufacturing Overhead - Variable 900 Manufacturing Overhead - Fixed 600 Administration - Fixed 300 RM7,200 RM1,800 Total costs Operating Income MG Company expects to continue its operations at 75 percent capacity, recently submitted a bid of RM52,800 on custom-made machine for MeeMaks Company. MG Company used a pricing formula in deriving the bid price, the formula being based on last year's operating results. The formula follows: Estimated direct material Estimated direct labor Estimated total manufacturing overhead at 50% of direct labor Estimated total administrative costs at 10% direct labor Estimated total costs excluding sales commissions RM11,680 22,400 11,200 2,240 RM47,520 Suggested total price (RM47,520/0.9* adjusted for 10% sales commission) RM52,800 Required: a) Calculate the impact on MG's operating income if the RM52,800 bid were accepted by MeeMaks Company. (6 marks) b) Assume that MeeMaks has rejected MG's bid but has stated instead they are willing to pay RM47,500 for the machine. Should MG sell it at the counter offer of RM47,500? Justify your answer and show relevant calculation. c) Determine the bid price that will break-even for the order. (5 marks) (3 marks) d) Distinguish between skimming pricing and penetration pricing and explain whether these two pricing strategies are viable alternatives for most products. (6 marks)