Computing weighted-average direct manufacturing labour rate

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Reference no: EM1310616

1) You are negotiating the non-competitive contract for production of replacement parts for equipment produced by Perry Products to meet exclusive Government requirements. Perry's cost proposal comprises estimated direct labour cost of= $49,000 (5,000 labour hours at $9.84 per hour). Estimate is based on given direct manufacturing labour information:

                    Labour Category Labour Rate   Projected Labour Hours
Team Leader    $14.50                                               250
Assembly         $8.20                                               2000
Fabrication       $7.50                                               1500
Production       $9.00                                                 750
QC/Test          $10.00                                                500
Totals                                                                       5000

i) By using above information, what weighted-average direct manufacturing labour rate must you use in making your manufacturing direct labour cost objective?

ii) By using the above information, what must be your direct manufacturing labour cost objective for this contract?

Reference no: EM1310616

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