Question - There are four employees in the welding department. Three employees are responsible for welding a rod to a cylindrical plate, creating a subassembly used in the production of pistons. The fourth employee inspects the completed subassembly and, if necessary, grinds and removes any unnecessary bumps (protuberances) so that the subassembly becomes usable (which occurs in approximately one-third of the cases because of less than efficient welding). The welders are each paid a salary of $50,000. The fourth employee, who is responsible for inspecting and grinding, is paid a salary of $40,000.
Calculate the value- added and the non- value added cost.