hi
confused about a question in kaplan book ma1 2015 edition page 148 question 1
a job requires 2400 actual labour hours to complition and it is anticipated that there will be 20% idle time
if the wage rate is $10 per hour ,what is the budgeted labour cost for the job ?
a- 19200
b-24000
c-28800
d-30000
answer at the back is 2400 x 100/80 =30 x 10= 30000 = option d
in my mind it should be c
2400 x 1.2 =2880x10=28800 = option c
am i wrong . if i am why are we multiplying actual labour hours with 1.25 rather then 1.20 in the answer at the back
thanks
FIA Forums
budgeted labour hour cost
Workers will work some amount of hours - this figure you should find.
Out of this total time they will have idle time 20%, and actual labour time 2,400 (so this 2,400 is 80% of total time).
And the company will pay for total time, that is 30,000. This should be budgeted for the work.
Hope this helps
10y ago#2Or think of it like this:
Total hours paid - idle hours = hours worked
100 - 20 = 80
Hours worked = 2,400, so hours paid for = 2,400 x 100/80 = 3,000
3,000 hours paid for at $10/hour = $30,000.
thank you very much for your help
i understand now .
so if total time paid is x= 100%
and time worked is 80% of x= 2400
2400=80% of x
so 2400/80 = 1% of x
30= 1% of x
x= 3000
hours paid is 30000
thanks
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