A boat manufacturer has committed to supply 16 units of a particular model of boat in the
Question:
A boat manufacturer has committed to supply 16 units of a particular model of boat in the next 16 weeks, at a price of $30,000 per boat.
The first boat took 1,000 hours to produce, and the second boat took 750 hours to produce. The boat manufacturer provides the following information about labour and costs and is anxious to know if the commitment will be met at a profit.
Labour availability | 500 hrs/week |
Labour cost | $10/hr |
Material costs | $22,000/boat |
Overhead costs | $2,000/week |
What is the total cumulative time required to produce 16 boats? Enter your answer in hours.
QUESTION 7
Referring to the information provided in Question 6 above, determine the total profit the boat manufacturer will earn on the order. (Hint: determine the total revenue from the sale of 16 boats, and subtract the total costs. Be sure to consider weekly and hourly costs appropriately.)