QUESTION $1$

The XVZ company builds a fire resistent door factory. The factory planned to market their

product in the Asean region in the next $2$ years. This is the info related to the factory own

by the $xYZ$ company:

Annual capacity of factory :$2,000$ units of fire resistant door.

Selling price of each unit: RM $600.$

Inital cost of factory: RM $100,000$

Fixed operation expenses : RM $50,000$

Cost labour per unit : RM$200$

Cost material per unit : RM$100$

The factory is subject of a morgage $20$ years of repayment at interest of $15\%($fixed rate$).$

Based the above information:

i$.$ Explain how the break$-$even method can be applied in the construction industry to

assess the financial viability of a construction project.

ii$.$ Calculate the annual cost of morgage.

iii. Find the total annual fixed costs.

iv$.$ Number of output at break$-$even.