Question
Erdo Sdn. Bhd. has received a once-off order to manufacture a specialised machine. The machine will require 450 hours of skilled labour to make who
Erdo Sdn. Bhd. has received a once-off order to manufacture a specialised machine. The machine will require 450 hours of skilled labour to make who are currently employed by the company at RM40 per hour. The company is currently facing of production backlogs arising from closure of the manufacturing facilities for deep cleaning as one of its staff has been tested positive for Covid-19. In order to make up for loss hours, the skilled labour will be asked to work overtime at time and a half of the existing rate to fulfil this order. However, the company will still need to pay a fine of RM500 for late delivery to the customer. Alternatively, the company can hire external employees who is estimated to have only 90% efficiency level of its workers at RM50 per hour. Calculate the relevant labour costs (to the nearest RM) for manufacturing the specialised machine ordered by the customer.*
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