Learning curve applies to the labor required

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Reference no: EM1317832

Q. "You have been asked to estimate the selling price every unit of a new line of clothing. Pertinent data are as follows:

Direct labor: $15.00 every hour
Production material: $3.75 every unit
Factory overhead: 125% of direct labor
Packing costs: 75% of direct labor
Desired profit: 20% of manufacturing cost

Past experience has explain how that an 80% learning curve applies to the labor required for producing these units. The time to complete the first unit has been estimated to be 1.76 hours.

Using the answer to part ‘a' as the standard time estimate, Find out the estimated selling price every unit (i.e., Illustrate what is the estimated selling price based on the time to complete the 50th unit?)"

Reference no: EM1317832

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