Instructions: Each student will submit their own individual solutions. Solutions must be legible: can be handwritten or typed Please show full workings - just writing down an answer is not sufficient to earn maximum points. There are 8 questions worth a total of 160 points. The number of points for each question is shown in the question header. Question No.1 - (20 Points) Mac Company manufactures and sells adjustable canopies that attach to motor homes and trailers. The market for canopies includes both new unit purchases as well as replacement canopies. Mac developed its fiscal year 2011 business plan based on the assumption that canopies would sell at a price of $400 each. The variable costs for each canopy were projected at $200, and the annual fixed costs were budgeted at $100,000. Mac's after-tax profit objective for the entire year was $240,000; the company's effective tax rate is 40 percent. While Mac's sales usually rise during the second quarter, the May 2011 financial statements reported that sales were not meeting expectations. For the first five months of the year, only 350 units had been sold at the established price, with variable costs as planned, and it was clear that the 2011 after-tax profit projection would not be reached unless some actions were taken. Mac's president assigned a management committee to analyze the situation and develop several alternative courses of action. The following three mutually exclusive alternatives were presented to the president: Alternative 1: Reduce the sales price by $40. The sales organization forecasts that with the significantly reduced sales price, 2,700 units can be sold during the remainder of the year. Total fixed costs and variable unit costs will stay as budgeted. Alternative 2: Lower variable costs per unit by $25 through the use of less expensive raw materials and slightly modified manufacturing techniques. The sales price will also be reduced by $30, and sales of 2,200 units for the...