Assignment:
A shipping department that constructs wooden boxes for large switchgear has five direct labor workers. The firm uses an allowance factor of 10% for work of this kind. Average labor costs $18.75 per hour. A work-sampling study is undertaken, and the following observations of work elements are recorded over a 15-day, 8-hour period. A rating factor of 90% was assigned. The number of boxes shipped during this period is 26.
Description Count
Set up and dismantle 312
Construct crates 264
Load switch gear in cates 204
Move materials 324
Idle 96
a. Find the elemental costs
b. What is the standard labor cost per box?
c. Estimate the actual cost per box.