use of two types of machine: Cutting machines and assernbling machines. Estimates for next year include the folkwing per unit erkin Question 4 (a) Kunal Lid makes three products Alpha, Beta and Gamma All three products require the Product Alpha Beta Gamma Selling price per unit) 26 30 19 12 13 10 1 Variable production cost (per 3 3 unit) 7 Sales demand (units) 2.500 3.400 5.100 Time required per unil on 1.0 1.0 0.5 cutting machines (hours) Time required per unit on 0.5 1.0 0.5 gesembling machines Cours) The latal fixed costs for next year are expected to be 42.000 Kunal Lid has the following maximum capacities for the two machines Cutting machines 5,000 hours a year Assembling machines 2.000 hours a year Required: 1 State which products in which quantities Kunal Lid should plans to make next year on the Note: you should first determine which machine will be a imiting foctor. 2. to capacity issues). The directors of Kunal Ltd also want your advice regarding the possibility of a subcontractor to carry out that part the work (which Kunal Ltd would not be able to do due Advise the directors as to the maximum price per product that it would be worth paying to a subcontractor (12 marks) (b) Although break-even analysis can provide useful insights concerning the relationship between cost volume and profit, it does have its limitations Discuss limitations of break-even analysis for decision-making use of two types of machine: Cutting machines and assernbling machines. Estimates for next year include the folkwing per unit erkin Question 4 (a) Kunal Lid makes three products Alpha, Beta and Gamma All three products require the Product Alpha Beta Gamma Selling price per unit) 26 30 19 12 13 10 1 Variable production cost (per 3 3 unit) 7 Sales demand (units) 2.500 3.400 5.100 Time required per unil on 1.0 1.0 0.5 cutting machines (hours) Time required per unit on 0.5 1.0 0.5 gesembling machines Cours) The latal fixed costs for next year are expected to be 42.000 Kunal Lid has the following maximum capacities for the two machines Cutting machines 5,000 hours a year Assembling machines 2.000 hours a year Required: 1 State which products in which quantities Kunal Lid should plans to make next year on the Note: you should first determine which machine will be a imiting foctor. 2. to capacity issues). The directors of Kunal Ltd also want your advice regarding the possibility of a subcontractor to carry out that part the work (which Kunal Ltd would not be able to do due Advise the directors as to the maximum price per product that it would be worth paying to a subcontractor (12 marks) (b) Although break-even analysis can provide useful insights concerning the relationship between cost volume and profit, it does have its limitations Discuss limitations of break-even analysis for decision-making