Question 4 Makongo CC d has designed a new type of sailing boat for which the cost and sales price of the first boat to be produced has been estimated as follows: Materials Labour (800 hours x N$5 per hour) Overhead (150% of labour cost) (a) (b) (c) Profit mark-up (20%) Sales price (d) NS 5,000 15.000 25 Marks 18.000 It is planned to sell all the yachts at full cost plus 20%. An 80% learning curve is expected to apply to the production work. Only one customer has expressed interest in buying the yacht so far, but he thinks N$18,000 is too high a price to pay. He might want to buy two or even four of the yachts during the next six months. NB: The learning curve coefficient must be rounded off to four (4) decimals. REQUIRED: If he paid N$18 000 for the first yacht, what price would he have to pay later for a second yacht? What price could Makongo CC quote, for two yachts, if the customer ordered two at the same time? If the customer bought two yachts now at one price, what would be the price per unit for a third and a fourth yacht, if he ordered them separately later on? If the below yachts were all orders Marks (5)
