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QUESTION 1 (45 marks) CASE STUDY: HOT STEPPA LTD. A company specializes in leather boots for children in Northern Jamaica. The process of producing
QUESTION 1 (45 marks) CASE STUDY: HOT STEPPA LTD. A company specializes in leather boots for children in Northern Jamaica. The process of producing the boots involves both manual labour and machine time. The business has two production departments (but no service departments): (1) Forming and (2) Assembly The factory operates 48 weeks annually and is closed for 4 weeks for maintenance; during this time, all workers go on unpaid vacation leave. LABOUR The factory employs twenty-eight (28) workers who are directly involved in the production process. Each employee works from 8:00 a.m. to 5:00 p.m. daily, Monday to Saturday. Workers are paid hourly, excluding the hour taken for lunch, from 12 noon to 1:00 p.m. Seven (7) of the employees work in-the Forming department (mechanized) and are paid $275 per hour, while twenty-one (21) employees work in the Assembly department (labour intensive) and are paid $330 per hour. The company pays for overtime work at time and a half on weekdays and double time on Saturdays; the factory is closed on Sundays. On average, each worker in the Forming department is allowed 6 minutes to gather all the material before Forming. Workers in the Assembly department are allowed 12 minutes to ensure the assembly line is ready for operations.
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