Calculate the return per factory hour

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Question - Lightwater Limited manufactures product BJK 55 which requires 2 hours of labour time. Labour hours are a scarce resource, due to limited expertise and staff. The company has 120 employees.

Each employee works 8 hours per day.

The factory operates five days per week and 52 weeks annually. The company sells each unit of this product for $260 and the product uses direct material costing $70 per unit. The total factory costs are $180,000 per week.

Required -

a. Calculate the return per factory hour.

b. Calculate the cost per factory hour.

c. Calculate the TPAR.

d. What decision should be made by management.

Reference no: EM133000653

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