MCQ from BPP Study Kit

I am having difficulty in understanding this question as to why was there an adjustment for variable overhead cost and there wasn’t an indication of such in the question. Also I do not understand why the use of 0.97% was used to adjust selling price and not 3% (0.03), and why was 0.98% used for materials and not the 2%. and so on. I thought I understood what being asked but I got it all wrong, but when I looked at the answer I still didn’t understand the reasons for the workings. The only adjusted figure I had correct was Fixed Cost. Can you kindly assist with the explaination.

Thank you!

QUE:

A manufacturing company has the following monthly budget

Sales $480, 000
D. Mat $140, 000
D. Lat $110, 000
Var. O/H $ 50, 000
Fixed O/H $130, 000
Total costs $430, 000
Profit $50, 000

Sales can be increased by 15% per mth if an extra work shift is added, but the sales price would have to be reduced by 3% on all units sold in order to sell the extra volume. D. Lab is a variable cost, but work in the extra shift would have to be paid an extra 50% per hr on top of the normal hourly rate. Increased purchases of materials means that a bulk purchase discount of 2% will be available on all materials purchased. Additional fixed overheads would be $2,000 per month.