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One of the LGOs deals with the administration of a local preperty tax. The manager of this department wishes to introduce activity based budgeting. One of the activities that his staff are involved in is dealing with enquiries from taxpayers.The driver for this is the number of enquiries which is expected to be 28 800 per year. Each enquiry takes 15 minutes to deal with, on average. The salaries and other costs of staff employing staff to deal with such enquiries is $20000 per year. Each member of staff works 8 hrs per day for 240 days a year. A team supervisor is also employed at a cost of $35 000 per year. Each member of staff and the sypervisor requires a computer terminal which is leased at a cost of $200 per terminal.
From this text it was derived that 15 staff member worked, but how? Please help.
I do not have the Becker Kit (only the BPP Revision Kit) but if you have typed out the question correctly, it would seem that the answer is wrong.
The total time needed to deal with the enquiries is 28,800 / 4 = 7,200 hours.
Each member of staff works for 240 x 8 = 1,920 hours.
Therefore the number of staff needed is 7,200 / 1,920 = 3.75
(It seems as though their answer has not taken into account that each query takes only 15 minutes, but that they have treated it as though each query takes 1 hour. In which case 28,800 / 1,920 = 15 employees.
Check that you have copied it correctly and that there is no other information that might affect it. (It does also seem very strange that the cost of employing 15 staff is 20,000! That would mean they are only paying them $1,333 a year each!!!)
Doesn’t Kaplan show workings with their answers?
Thank you.
Becker shows calculations, but it uses this 15 employees,and I checked it. I followed exactly the way you described, it seems they have mistaken.
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