Q.4 Mikes IT Giants produces and sells computer software. Estimated unit data for next year are as follows: K Selling price 12,000 Variable costs : Labour 4,000 Materials 800 Selling 200 Anticipated fixed costs for the year are K1.600.000 for administration and K1,200,000 for selling and distribution. Estimated sales for the year are 12,800 programmes. Required: a. 1. Calculate the breakeven point in terms of number of programmes sold and sales revenue. (5 Marks) ii. Determine the margin of safety as a percentage of estimated sales. (3 Marks) b i. ii. . If the company Os profit target is K1.120.000. Calculate the number of programmes the company should sell. (3 Marks) ii. The company is currently negotiating with an overseas client. If the negotiations are successful, a five Dyear contract will be signed for purchase by this client of 60,000 programmes per year in each year of the contract. Discuss the possible implications for the cost/volume/ profit model employed above if the company wins the overseas contact and expands accordingly. (9 Marks)