Question 5 5a) Cosh Corporation produces three products that share use the same production facilities. The details of the selling price and costs of each product for next year are detailed below: Product A Product B Product C Expected sales next year in units 5,200 5.200 5,200 Direct labour hours per unit 4 hours 6 hours 2 hours E E E Selling price per unit 45 65 70 Minus Variable costs per unit 20 32 52 Minus Allocated xed costs based on the direct 20 30 10 labour hours used The xed overhead total is forecast next year as 312,000. Fixed overheads are charged to product costs on the basis of direct labour hours. Required: i) Calculate the expected prot of the company next year. [3 marks] ii) Calculate the contribution for each unit made by each of the three products. (If necessary, show your answers to two (2) decimal places. [3 marks] iii) If 50,000 is spent on an advertising campaign, as a xed cost and the unit sales of each product are expected to increase by 800 units. Show by calculation whether the advertising campaign will increase the rm's prot. (Note: this does not relate to (iv) below.) [4 marks] iv) If only 60,000 labour hours are available, and 5,200 units of each product is produced and sold, explain with reasons and showing supporting calculations, how many of each product should be made/sold to maximise the company's prot. (Note: this does not relate to (iii) above.) [6 marks] 5b) Landy Ltd sells a product for which data are given below: g Selling price per unit 20 Variable cost per unit 8 Fixed oost per unit 4 The xed costs are based on a budgeted level of activity of 6,000 units made and sold for the period. Required i) Calculate and show the break-even point in units for Landy Ltd. [3 marks] ii) Calculate and show the margin of safety in units for Landy Ltd. [3 marks] iii) Calculate and show how many units must be sold it the company wishes to earn a prot of 48,000 for the period. [3 marks] [Total 25 marks]