Question: management accounting Test Your Knowledge: Question 1 A company which produces and sells wheel barrow in Maseru has to-date produced 128 wheel barrows. The company

management accounting

Test Your Knowledge: Question 1 A company which produces and sells wheel barrow in Maseru has to-date produced 128 wheel barrows. The company has now received a order for 128 wheel barrows. Data in respect of the first 128 wheel barrows manufactured are as follows: Direct material cost M8 000 Direct labour (@ M4 per labour hour) M8 800 Variable overheads @M2.20 per hour M48 40 Fixed overhead @ M150 per wheel barrow M19 200 The cumulative average time for the first 64 wheel barrows manufactured was calculated as 20 hours per unit. The Gross profit based on the cost price is 25%. Test Your Knowledge Question 1: continued Required Calculated the following: a) The learning curve effect or rate. b) The labour hours required to produce the 128 wheel barrows c) The total manufacturing cost of producing the order for 128 wheel barrows d) The cost of producing one wheel barrow of the order The total expected profit for this order

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