P17.34 Analysis of economic, environmental and social costs: manufacturer LO 17.5, 17.8 Rockhampton Sofa Company is thinking of setting up a plant in Chengdu, China. Operating data for Rockhampton and Chengdu are as follows: Material per sofa Labour time per sofa Labour cost per hour Waste per sofa Rockhampton Chengdu $105 $75 30 minutes 90 minutes $25.00 $5 15 kilograms 35 kilograms Effective working weeks per annum per employee 40 49 Fixed manufacturing cost Delivery time $100 000 per annum 7 days $50 000 per annum 27 days If the Chengdu plant is opened, the Rockhampton plant will be closed. If the Rockhampton plant is closed the employees will almost certainly be unemployed. There is consternation in the local community about the closure, especially among older employees. The plant appears to have few airborne pollutants and does not contaminate waterways and sewers. Required 1. Rank the alternatives using only financial data. 2. Rank the alternatives using only environmental and social impact data. 3. Identify any impacts that this decision may have on the broader economy. 4. Write a recommendation to the board outlining the issues it should consider when making this decision. 5. Explain the key differences between absorption cost and variable cost approaches to defining cost for pricing purposes