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Armourco Ltd. manufactures and ts a range ofannoured attachments to standard army vehicles to protect them against attacks by guerrillas and damage from land mines. Due to worsening conicts in Rhodambia, the British Army is to form part ofa United Nations peace-keeping force to be sent into the area. Armourco has been invited by the Government to tender for a special contract to supply and t armoured kits to four-wheel drive vehicles, which are to be airiifted to the trouble-spot. The ultimate size of the order is not yet known, but the company has been asked to quote selling prices for orders of 50 kits and 100 kits assuming the size ofthe order will be known when the contract is placed; and also to quote a separate price for an extra 100 kits subsequent to the initial order. The following data are relevant: Armourco estimates costs for an initial order of 50 kits to be: Direct materials: X 2000 kilograms at 10.00 per kilogram Y 500 metres at 25.00 per metre Direct wages: Department: 1 160 hours at 12.50 per hour 2 1000 hours at 15.00 per hour 3 2000 hours at 10.00 per hour Variable Overhead: 25% of direct wages Fixed overhead rates per hour\". 1 E 5 per hour 2 20 per hour 3 E 5 per hour The nature ofthe work in the three departments is as follows: Department 1 uses highly automated machines. The efciency of the operators can have little impact on the quantity of output Department 2 employs skilled operators. Experience has shown that an 30% leaming curve can be expected to operate Department 3 also employs skilled operators. Here a ?5% learning curve is expected On orders of this type, it is the company's practice to add the following margins on cost in arriving at selling prices: Direct materials 20% Conversion costs 40% Required: 1. Ca lw late the price per kit for an initial order of 50 kits. (Round your answer to 2 decimal places.) 2. Calculate the price per kit for an initial order of 100 kits. {Round your answer to 2 decimal places.) ..mheducation.comlhm.tpx Cost Behaviour 3. Calculate the price per kit for a separate order for an extra 100 kits subsequent to the order for 100 in (2} above. (Round your answer to 2 decimal places.}