Problem 2: (15 points) Manager of the Repair and Maintenance division of ABC yacht center was approached by a successful local physician about refurbishing her yacht. She wanted an engine overhaul, complete refurbishment and redecoration of the cabin facilities, and stripping and repainting of the hull and deck. Data regarding the operations of the Repair and Maintenance divisiont are as follows: $18.00 per hour $7.00 per hour 10,000 hours Labor rate, including fringe benefits Hourly charge to cover profit margin Annual Budgeted labor hours Annual Budgeted overhead costs: Material handling and storage Other overhead costs (supervision, utilities, insurance, and depreciation) Annual Budgeted cost of materials used in Repair and Maintenance division $40,000 $200,000 $1,000,000 It is estimated that the yacht refurbishment job would require 200 hours of labor and $8,000 in material. Repair and Maintenance division added a markup of 5 percent on the material charges of a job (including the cost of material handling and storage). Required: 1) Compute the price to be quoted on the yacht refurbishment for the local physician. 2) List the advantages and disadvantages, with detailed explanation, of the pricing strategy using in required 1