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EX.12: You have been asked to estimate the total cost of producing 100 engines in a factory Current engines have an output of 125 hp

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EX.12: You have been asked to estimate the total cost of producing 100 engines in a factory Current engines have an output of 125 hp per engine.years ago, a similar 150-hp engine cost $5,150, Due to extreme competition, the cost of an engine has decreased by an average of 2% per year throughout the period. Total cost consists of component cost, direct labor cost and other labor-related costs Direct labor cost $15 per hour factory overhead 125% of direct labor Packing costs 75% of direct labor Cost -capacity factor 0.75 > S 85 Past experience has shown that an 85% learning curve applies to the labor required ired Finans producing these engines. Use time to complete the 58h engine for the purpose of estimating 88 the direct labor cost. The time to complete the fir engine has been estimated 85 hours

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