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Wee Designs develops web pages to customer order, primarily for business applications. The company charges its customers P 40 per hour for programming time. The
Wee Designs develops web pages to customer order, primarily for business applications. The company charges its customers P 40 per hour for programming time. The managers are planning operations for the coming year and have developed the following estimates: Total estimated chargeable hours 80,000 Total fixed costs, salaries, rent, etc P 1,750,000 Wee Designs employs 15 full-time programmers at an average salary of P 30,000. These salaries are included in the above cost figures. Each programmer works about 2,000 chargeable hours a year. The company does not wish to hire additional programmers but rather wants to use freelancers to meet demand. Freelancers charge an average of P 25 per hour. 5. If the company meets its goal of 80,000 chargeable hours, what profits will it earn? a. P 1,450,000 b. P 500,000 c. P 700,000 d. P 200,000 6. How many chargeable hours must it obtain from freelancers in addition to the hours its full-time programmers work to earn a P 300,000 profit? a. 46,000 b. 54,000 c. 30,000 d. 80,000 7. If the company will meet the 80,000 chargeable hours and would want to have P 300,000 profits, what rate can they offer the freelancers? a. P 15.625 b. P 25 c. P 23 d. P 14.375
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