Czinn Industries makes refrigerators with the following results in 2021: Units manufactured and sold 10,000 Selling price $2,000 Variable cost per unit $1,200 Hours spent on design 6,000 Testing and inspection hours per unit 0.5 Percentage of units reworked in plant 5% Rework costs per unit $500 Percentage of units repaired at customer site 4% Repair costs per unit $600 Estimated lost sales from poor quality (units) 300 The labor rate in Design is $75 per hour; the labor rate in Testing & Inspection is $40 per hour. MY QUESTION IS, HOW DO I CALCULATE THE APPRAISAL COST? THE ANSWER ON BARTLEBY SAYS 4,000 BUT I GOT 200,000. THEY SAID THEY DID 10,000 * 0.50 * 40, BUT THAT GIVES 200K, NOT 4K. PLEASE CLARIFY
Czinn Industries makes refrigerators with the following results in 2021:
Units manufactured and sold 10,000
Selling price $2,000
Variable cost per unit $1,200
Hours spent on design 6,000
Testing and inspection hours per unit 0.5
Percentage of units reworked in plant 5%
Rework costs per unit $500
Percentage of units repaired at customer site 4%
Repair costs per unit $600
Estimated lost sales from poor quality (units) 300
The labor rate in Design is $75 per hour; the labor rate in Testing & Inspection is $40 per hour.
MY QUESTION IS, HOW DO I CALCULATE THE APPRAISAL COST? THE ANSWER ON BARTLEBY SAYS 4,000 BUT I GOT 200,000. THEY SAID THEY DID 10,000 * 0.50 * 40, BUT THAT GIVES 200K, NOT 4K. PLEASE CLARIFY
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