A. Choudray (Engineering) Ltd makes a product that is sold for 105 per unit and has...

 

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A. Choudray (Engineering) Ltd makes a product that is sold for £105 per unit and has the following costs per unit: Variable material cost Labour cost Share of fixed costs £ 22 40 23 85 The labour cost includes 3 hours' charge for assemblers who are paid £10 per hour. The business is considering sub-contracting the assembly work as demand for the product outstrips the ability of the business to assemble the parts that are produced to make the product. What is the maximum price that the business should be prepared to pay to have one unit of the product assembled? A. Choudray (Engineering) Ltd makes a product that is sold for £105 per unit and has the following costs per unit: Variable material cost Labour cost Share of fixed costs £ 22 40 23 85 The labour cost includes 3 hours' charge for assemblers who are paid £10 per hour. The business is considering sub-contracting the assembly work as demand for the product outstrips the ability of the business to assemble the parts that are produced to make the product. What is the maximum price that the business should be prepared to pay to have one unit of the product assembled?

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