Question: In previous Problem, if the work load for the cell can only justify a one-shift operation. determine the appropriate hourly rate for the work center.
Problem: The hourly rate for a certain work center is to be determined based on the following data: direct labor rate = $15.00/hr, applicable factory overhead rate on labor = 35%; capital in-vestment in machine - $200,0o0; service life of the machine = 5 years; rate of return = 15%; salvage value in the years = zero; and applicable factory overhead rate on machine = 40%. The work center will be operated two 8-hr shifts. 250 day/yr. Determine the appropriate hourly rate for the work center.