Question
A cabinet manufacturing company has started its operations by July, 1st. The following cost items have been determined until the end of December: (i) Raw
A cabinet manufacturing company has started its operations by July, 1st. The following cost items have been determined until the end of December: (i) Raw material #1 -> unit cost is 20 $/m2 and 6 m2 is required per cabinet; Raw material #2 -> unit cost is 40 $/m2 and 4 m2 is required per cabinet. (ii) Spare material (such as screw, lock, nail etc.) -> unit cost is 70 $ per cabinet. (iii) Direct labor costs -> 150 $ per cabinet. (iv) Foreman and supervisor cost -> 100.000 $ monthly. (v) Machinery depreciation -> 120.000 $monthly. (vi) Administrative costs of production -> 140.000 $ monthly. Suppose that the company has produced 2.000 cabinets during the period. Suppose that the company has sold all of its cabinets at a price of 1.800 $. What is the gross profit?
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