Question: B 10 points SECTION A-Question 3 (10 Marks) A special contract had been offered to the company to serve as project manager to oversee
B 10 points SECTION A-Question 3 (10 Marks) A special contract had been offered to the company to serve as project manager to oversee a plantation owned by a U.K. based company in Timor-Timor. The plantation is quite sizeable. The contract is for 10 years. The business volume is estimated to be about RM11,500,000,000 per annum. The contract is for a fee of 1% of the gross revenue. It will involve some logistic costs of about RM 12,000,000 per month for the management team. They may be some additional income from the subcontracting works that the company may perform in the plantation, in the region of RM 1,500,000 per month. a) Should the company take up the contract? If the answer is yes, which of the subsidiary in question 3 should be the contract? And why? (8 Marks) b) What are the qualitative considerations that must be taken into account in the decision? (2 Marks) signing BIVA AIE xEE 12pt Paragraph 3a) Yes because there is a potential profit of RM104,500,000 from this contract
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