The cost accounting team at Central Precast Concrete (CPC) has prepared the following forecast of annual costs for this year at its manufacturing facility in Nepean, Ontario: CPC uses the percentage of direct labour cost method for allocating factory overhead. CPC also requires that any approved job makes a contribution to general business and marketing overhead of 22% of the Cost of Goods Manufactured. CPC management expects a minimum profit margin of 18% of Cost of Goods Sold. Central Precast Concrete is bidding on the University of Toronto Landmark Project in King's College Circle. CPC marketing engineers believe that the University of Toronto will pay $65000 for each concrete structure. There are two alternatives for manufacturing the concrete structure using different processes: Process A Alternative: This option requires 300 hours of direct labour. The materials will cost $25000. Process B Alternative: This option requires 200 hours of direct labour and has materials cost of $29000. For both alternatives, the labour rate would be $30.00 per hour. (a) In the normal course of business, would you recommend that CPC go ahead with this job if CPC plans to bid $65000 for each concrete structure? Be sure that your financial analysis and explanation support your recommendation. (Hint: Note that you are not being asked to recommend a preferred alternative.) [9] (b) Consider the case where rather than having a customer willing to pay $65000, CPC is bidding on a very competitive tender to provide the same concrete structure. It is a very slow time of the year for CPC and management is desperate for work. What is the absolute minimum price that CPC should bid on the tender? What manufacturing process should CPC use and discuss how any price above the minimum you have determined would help CPC financially. [5]