Problem 13 A factory's normal capacity is 1,20,000 units per annum. The estimated costs of production for the year 2011 are as under: Direct Materials $3 per unit. Direct Labour $2 per unit (subject to a minimum of $12,000 p.m.) Overhead Fixed $1,60,000 p.a., Variable $2 per unit; Semi Variable $60,000 p.a. upto 50% capacity and an additional $20,000 for every 20% increase in capacity or part thereof. Each unit of raw material yields scrap which is sold at the rate of 20 Cents. In the year 2012 the factory worked at 50% capacity for the first three months but it was expected that it would work @ 80% capacity for the remaining 9 months. During the first three months, the selling price per unit was $12. What should be the price in the remaining nine months to produce a total profit of $2,18,000