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This might be quite simple in terms of arithmetic, but I am really just looking for the logic. Here is the question:
“A contract cleaning firm estimates that it will take 2,520 actual cleaning hours to clean an office block. Unavoidable interruptions and lost time are estimated to take 10% of the workers’ time. If the wage rate is $8.50 per hour, the budgeted labour cost will be:
A $19,278
B $21,420
C $23,562
D $23,800Answer is D. Can someone walk me through the logic?
Thank you!
For every 100 hours paid, they will only actually work for 90 hours (10% less).
Or, putting it the other way round, for every 90 hours of work they will have to pay for 100 hours.
Here we need 2,520 hours of work, so it will mean paying for 2520 x 100/90 hours.
Now you should have no problem.
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