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Bygdheim AS will set up a contribution calculation for an order. Direct labor costs in manufacturing departments 1 and 2 are expected to be NOK
Bygdheim AS will set up a contribution calculation for an order. Direct labor costs in manufacturing departments 1 and 2 are expected to be NOK 8,000 and NOK 10,000, respectively. Direct material costs are estimated at NOK 5,000. The company has divided its business into three cost centers; manufacturing department 1, manufacturing department 2 and the sales and administration department. The additional rate for indirect variables costs in manufacturing departments 1 and 2 are 10% and 20%, respectively. Activity goals are respectively direct salary in manufacturing departments 1 and 2. The additional rate for indirect variable costs in sales and the administration department is 5%. Activity goals are total variable manufacturing costs. Corporate coverage requirement is 40%. Calculate sales price incl. VAT for the order.
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