You are the management accountant of a printing company which has been asked to quote for the printing of posters for the Glenwood community festival. The work would be carried out in addition to the normal work of the company. Because of existing commitments, some weekend work would be required to complete the printing of the posters. A trainee accountant has produced the following cost estimate based upon the resources as specified by the production manager: Note R 1 7 500 2 700 N Direct Materials Cardboard-book value Inks - purchase price Direct Labour Skilled 250 hours at R40.00 per hour Unskilled 100 hours at R30.50 an hours Variable Manufacturing Overheads 3 4 10 000 3 050 5. Variable overheads represent the cost of operating the printer. 6. When not being used by the company, the printer is hired to outside companies for R60.00 per hour. This earns a contribution of R30.00 per hour. There is unlimited demand for this facility. 7. Printer depreciation represents the estimated loss in market value per hour of usage. 8. Fixed production costs are absorbed into production using predetermined hourly rates. 9. The estimating costs are an allocation of the department's existing costs based on time spent in discussions with the community's organizing committee for the printing of the posters. 10. The company's policy is to apply a 20% mark-up on total production costs to recover administration costs and then to have a profit equal to 20% of the selling price. However, as the company would like to secure the order, the mark-up to recover the administration costs will remain, but the profit markup will be 10% of the selling price. REQUIRED: 1. 2. Calculate the minimum selling price that the company should quote for the order. Give reasons for your inclusion or exclusion of all costs given in the question. (12) Discuss five qualitative factors which should be considered when making the decision. (10) Explain what a limiting or key factor is and give three examples of limiting factors in a business environment. (5) 3