Please answer (a), (b) and (c)

QUESTION 1 A. MesinPadu Sdn Bhd (MPSB) is about to complete the order from Syarikat B on a special machine. However, just as MPSB completed manufactured the special machine, Syarikat B has shut down their operation due to Covid-19 pandemic. It resulted the deposit of 10% from the selling price of RM36,250 paid by Syarikat B is forfeited. The following is the cost incurred to produce the special machine required by Syarikat B. RM Direct material 8,300 Direct labor 10,700 Variable manufacturing overhead applied 5,350 Fixed manufacturing overhead applied 2,675 Fixed selling and administrative costs 2,703 To solve the problems, MPSB has three alternatives: 1. To sell the special machine to another company, Syarikat Y, and treat it as a special order. The special machine needs to undergo process to suit the specification required by Syarikat Y. The selling price of the machine is RM34,200 with the additional cost incurred as follows: Direct material RM3,100 Direct labor RM2,100 2. To convert the special machine into a standard model. The selling price for the standard model is RM31,250 with the additional cost incurred as follows: Direct material RM1,425 Direct labor RM1,650 3. To sell the special machine as it is at a price of RM26,000. The potential buyer offered to pay RM3,500 down payment, with the remainder being paid upon delivery. The following are the information related to MPSB operations: 1 . The commission rate for special machine is 3 percent, while for standard model is 2 percent. 2. Normal credit term for sales of standard model are 2/10, n/30. While for special order, it is negotiated with the customer. 3. The allocation rates for manufacturing overhead and fixed selling and administrative costs are as follows: Variable manufacturing costs 50% of direct labor cost Fixed manufacturing costs 25% of direct labor cost Fixed selling and administrative costs 10% of product cost 4. Normal time to reworked is one month. REQUIRED: (a) Calculate the operating income for each of the alternatives above. (b) Advise the best solution for MPSB based on the calculation in (a). (c) Discuss when it is appropriate for special orders to be considered. Give TWO (2) conditions