Question 3 Debbie is considering setting up in business as a farmer of organic, free-range eggs. Kof's Eco Foods agrees to buy her eggs at 20 pence each, provided the minimum quality threshold is reached. Debbie has worked out the following cost and revenue information: Rent for a 3,000 square metres field with suitable housing for the hens is available at a cost of 1,000 a year. Power for the year will cost 700. Water for the year will cost 350 Debbie's hens need 3 square metres of space each and she wants to buy the maximum number possible at 3.50 each. Debbie decides to spread the cost of the hens equally across the 2 years of their life. The hens cost her 10 pence a day to feed. The hens have a useful life of two years after which the local pet food factory will come and collect them for free. Debbie expects the hens to lay an egg on 95% of the days in a year in both year 1 and year 2 Debbie estimates that one worker will need to be paid 50 per week to look after the hens Debbie intends to pay herself a salary of 10,000 per year. You are required to: a) Prepare a budget for Debbie for the first year, including costs by category and projected profit/loss. [14 marks) b) Calculate how many eggs Debbie needs to produce in the first year to break-even. [6 marks) Total 20 marks