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Question 5: Masood & Co. has been asked to quote a price for a special job that must be completed within one week The job
Question 5: Masood & Co. has been asked to quote a price for a special job that must be completed within one week The job requires a total of 150 skilled labour hours and 70 unskilled labour hours. The current employees are paid a guaranteed minimum wage of Rs. 560 for skilled workers and Rs. 420 for unskilled workers for a 35-hour week. Currently, skilled labour has spare capacity amounting to 85 labour hours each week and unskilled labour has spare capacity amounting to 20 labour hours each week. Additional skilled workers and unskilled workers can be employed and paid by the hour at rates based on the wages paid to the current workers. The materials required for the job are currently held in store at a book value of Rs. 5,500. The materials are regularly used by Masood & Co. and the current replacement cost for the materials is Rs. 4,800. The total scrap value of the materials is Rs. 1,000. The company decides to use the material placed in store for the said job completion. What are the relevant costs on this job? (10 Marks)
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