please answer this question and scanned firts if you are doing it on paper its has to be clear

QUESTION 4: Kamran Limited (KL) produces a variety of electrical appliances for industrial as well as domestic use. The average life of the equipments is six years. According to the terms of sale, the company has to provide free after sales service, including parts, during the warranty period of one year. Thereafter, the services are provided at market rates. The company has hired Ahmed Hasan Associates (AHA) to provide these services on the following terms and conditions: . . The material required for repairs carried out during the warranty period is provided by KL. For customers whose warranty period has expired, the material supplied to AHA is billed at cost plus a mark-up of 15%. Labour and overheads incurred by AHA on services provided during the warranty period are billed to KL at cost plus 30%. KL gets a share in all amounts billed to the customers after the warranty period. 10% share is received in respect of amounts billed to industrial customers and 15% in case of domestic customers. The management of KL is evaluating the possibility of providing the services directly instead of outsourcing them to AHA. On the instruction of the CEO the management accountant has compiled the following information in respect of the previous year: . . . 20% of the services were provided to domestic customers and 80% to industrial customers. 20% of all services were provided during the warranty period. Mark-up billed to AHA amounted to Rs. 360,000. An amount of Rs. 990,000 was received from AHA being the KL's share of amount billed to the customers. It has been estimated that the cost of material billed by AHA, to the customers, is determined by applying a further mark-up of 25% over the amount billed by KL. The service charges are billed at 50% above the cost of labour and variable overheads. It is estimated that the cost of labour and variable overheads will increase by 10%, if the services are provided by KL. However, KL will not be able to pass on this increase to the customers. Moreover, a supervisor will have to be appointed to oversee the process, at a consolidated salary of Rs. 40,000 per month. Other fixed overheads will also increase by Rs. 60,000 per month. . Required: a) Compare the two options and determine whether KL should terminate the contract with AHA and start providing the services itself. b) What other qualitative factors should KL consider before taking a final decision? (20 Marks)