3. 2. (a) The accountant has prepared a draft budget for the coming year based on the three items produced. Details are as follows:- Product B C A Budget Sales (units) 20,000 15,000 8,000 Sales Price per unit 30 40 50 Variable Cost per unit Material Labour 10 12 9026 9963 20 30 6543 Selling Fixed Labour Cost 110,000. Calculate the yearly profit (b) On studying the budget, the owner suggests to the Accountant that:- A special advertising campaign costing 65,000 should be undertaken that would increase sales of all products by 25% for the year. Prepare a new budget indicating the profit. What recommendation would you make to the owner? [25 marks] The following data represents an estimate of the demand, at various projected prices. for a product having a marginal cost of 12. Price Expected demand at this price (units) 24 22 20 18 16 14 12 11 1,000 1,300 1,700 2,100 2,600 3,200 4,300 5,600 Machines to make the product have a capacity of 1,500 units and fixed costs are 5,000 per machine. The company can have as many machines as it wishes. (a) What level of production will give the maximum profit? (b) What profit would the company make if it produced 1,500 units and sold them at 21 each.