Question 3 (a) Hydrangea Limited sells air coolers. The target profit for the year is $250,000 with a selling price of $300 per unit. The production costs are as follows: Variable cost per unit $50 Annul fixed costs for the year is $1,472,500 Required: (i) Calculate the breakeven point in units. [3 marks] The sales manager is considering increasing the price to $360 per unit, with an expected in sales volume. (ii) Calculate the new breakeven point in units if the selling price is increased to $360 per unit. [3 marks] (iii) Briefly explain the reason for the difference in breakeven point before and after the increase in the selling price of the panel. [3 marks] (b) Describe the three categorises of inventories found in manufacturing companies. [6 marks] (c) Below are the costs incurred during the year by Hydrangea Limited to manufacture 2,000 ceiling fans: Costs Amount $ Direct materials 200,000 Direct labour 300,000 Variable manufacturing overhead 208,000 Fixed manufacturing overhead 75,000 Variable selling and administrative expense 120,000 Fixed selling and administrative expenses 125,000 Total 1,028,000 Required: (i) Using Absorption costing, calculate the total product cost. [3 marks] (ii) Calculate the cost per computer. [2 marks] [Total: 20 marks]