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Tiptop Textiles manufactures a wide range of fashion fabrics. The company is considering whether to add a further product that 'Superb' to the range. A market research survey recently undertaken at a cost of 50,000 suggests that demand of the 'Superb' will last for only one year, during which 50,000 units could be sold at 18 per unit. Production and sale of 'Superb' would take place evenly throughout the year. The following information is available regarding the cost of manufacturing 'Superb'. No de ROW (meters) Current Current resale cost 1.80 Pash Materials: Boch Superb would require 3 types of raw materials Posh Flash and Splash Quantities required. en stock levels and cost of each raw material are shown below Posh s used regularly by the company and One replaced as they are used. The current stock of Flash is the result of over buying for an earlier contract me material not used regularly by Tiptop Textiles and any stock that was not used to manufacture 'Superb' would The Company does not carry a stock of splash and the units required would be specially purchased Quantity regd. per unit of superb (Meters) Current stock Costs per metre of raw material Original Cost replacement cost 1.00 1,00.000 2.50 2.10 2.00 60.000 3.30 2.80 1.10 0.50 0 5.50 5.00 Labour Production of each 'Superb' would require a quarter of an hour of skilled labour and two hours of unskilled bour and 2 per hour for unskilled labour. In addition, one foreman would be required to devote all his working Textiles is currently finding it very difficult to get skilled labour. The skilled workers needed to manufacture 'Superb time for one year in supervision of the production of superb. Hes currently paid an annual salary of 15,000. Tiptop would be transferred form another job on which they are earning a contribution surplus of 1.50 per labour hour. comprising sales revenue of 10.00 less skilled labour wages of 3.00 and other variable costs of 35.50. It should company expects to have available 2,00,000 surplus unskilled labour hou not be possible to employ additional skilled labour during the coming year. If 'Superb' are not manufactured, the during the coming year. Because the company intends to expand in the future, it has decided not to terminate the services of any unskilled worker in the foreseeable future. The foreman is due to retire immediately on an annual pension payable by the company of 6.000. He has been prevailed upon to stay on for a further year and to differ his pension for one year in return 5.00 Sotish for his annual salary. skilled luboin Cost + opportunit lost Machinery: Two Machines would be required to manufacture 'Superb Mt 4 and MT 7. Details of each machine are as under: Start of the year End of the year & MT4 Replacement cost Resale Value 80,000 80.000 65,000 47,000 MT7 Replacement cost Resale Value 13,000 11,000 9,000 8,000 Straight-line depreciation has been charges on each machine for each year of its life. Tiptop Textiles owns a number of MT 4 machines, which are used regularly or various products. Each MT 4 is replaced as soon it reaches the end of its useful life. MT 7 machines are no longer used and the one which would be used for 'Superb is the only one the company now has. If it were not used to produce 'Superb' it would be sold immediately. Overheads: A predetermined rate of recovery for overheads is in operation and the fixed overheads are recovered fully from the regular production at 3.50 per labour hour. Variable overhead costs for Superb are estimated at 1.20 per unit produced. for decision-making, incremental costs based on relevant costs and opportunity costs are usually computed. You are required to compute such a cost sheet for 'Superb' with all details of material, labour overhead etc substantiating the figures with necessary explanations