Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Onandomba Pty (Ltd) provides skilled labour to the construction of low-cost apartments. They have recently been asked by a builder NHE to bid for a

image text in transcribed

Onandomba Pty (Ltd) provides skilled labour to the construction of low-cost apartments. They have recently been asked by a builder NHE to bid for a kitchen fitting contract for a new development of 600 identical apartments. Onandomba Pty (Ltd) has not worked for this builder before. Cost information for the new contract is as follows: Labour for the contract is available. Onandomba expects that the first kitchen will take 24 man-hours to fit but thereafter the time taken will be subject to a 95% learning rate. After 200 kitchens are fitted the learning rate will stop and the time taken for the 200th kitchen will be the time taken for all the remaining kitchens. Labour costs N$15 per hour. All overheads are absorbed on a labour hour basis. Onandomba Pty (Ltd) has collected overhead information for the last four months and this is shown below: Overheads (NS) Hour worked January 115 000 9 300 February 113 600 9 200 April 116 000 9 400 May 116 800 9 600 Onandomba Pty (Ltd) normally works around 150 000 labour hours in a year. Required: Calculate total labour cost that will be needed to complete the total 600 apartments. Note: Learning coefficient should be rounded off to 3 decimals while all other answers be rounded off to 2 decimals. NB: You are not required to enter the unit or currency symbol. Enter a numerical answer with no space. For example: 1000

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Accounting Tools For Business Decision Making

Authors: Paul D. Kimmel

3rd Canadian Edition

0470836792, 978-0470836798

More Books

Students also viewed these Accounting questions