A company offers ID theft protection using leads obtained from client banks. Three employees work 40 hours a week on the leads,
at a pay rate of $17 per hour per employee. Each employee identifies an average of 3,900 potential leads a week from a list of 4,800. An average of 8 percent of potential leads actually sign up for the service, paying a one-time fee of $90. Material costs are $1,300 per week, and overhead costs are $9,100 per week. Calculate the multifactor productivity for this operation in fees generated per dollar of input.
2 answers:
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The total cost applied to the job is $87,500 when the direct materials are $50,000, the cost of direct labor is $25,000 and the overhead cost is 50 % of direct labor.
<h3>What is meant by total cost?</h3>Total cost means the combined cost of materials, human labor, and the overheads incurred in the process of production.
Given values:
Cost of direct materials: $50,000
Cost of direct labor: $25,000
Cost of overheads: $12,500 ($25,000 X 50%)
Computation of total job cost:
Therefore, when the direct materials are $50,000, the direct labor is $25,000 and the overhead cost is $12,500, then the total cost of the job is $87,500.
Learn more about the overhead cost in the related link:
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