Accounting for Labour

Hello Sir,

Another question which I’m not sure of why am I getting a wrong answer.

A plc makes engineering components. The company has been manufacturing 6,000 components per week, with six direct employees working a 40-hour week, at a basic wage of $4.00 per hour. Each worker operates independently.

A new remuneration scheme is being introduced. Each employee will receive payment on the following basis:

First 800 components per week16 cents per unit
Next 200 components per week17 cents per unit
All additional components per week18 cents per unit

There will be a guaranteed minimum wage of $140.00 per week. It is expected that output will increase to 6,600 components per week with the new scheme.

The wage per employee using the new remuneration scheme is:

Select one:
a.

$180
b.

$140
c.

$160
d.

$200

If I do the following:

800 * 0.16 = 128
200 * 0.17 = 34
(6600-800-200) * 0.18 = 5600 * 0.18 = 1,008

128+34+1,008 = 1,170
1,170 / 6 = 195.

The correct answer is 180, can you explain why?