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Midterm 2425 S1 Fall Question 6.2)

Midterm 2425 S1 Fall Question 6.2)

by Bárbara Valente P. A. Gonçalves -
Number of replies: 1

I calculated the total cost of cleaning, but then I don't fully understand the intuition behind the calculations of the cost of maintence to cleaning. 

Shouldn't it be 200Lh x 5.25 (what maintenence uses of cleaning)?

In reply to Bárbara Valente P. A. Gonçalves

Re: Midterm 2425 S1 Fall Question 6.2)

by Pedro Pinto da Silva Perdigão -
Hello Bárbara,

Using the the rates given for Mixer and Oven you would be able to get to the full costs allocated to Cleaning - 4 200€

But these costs already include whatever amount was allocated from Maintenance to Cleaning, and you want to find the costs directly allocated to cleaning. Maintenance had given 100h to Cleaning - therefore, if you were able to find the rate for Maintenance before (10.05€/Lh), you just need to discount the part that Maintenance gave to Cleaning in order to find the directly assigned overheads.

Therefore, 4 200€ - 100*10,05€ = 3 195€

Good study!