Question

It takes a lawyer 120 minutes to serve one customer. Demand is 2 customers per eight-hour day. The lawyer has a wage rate of $200 per hour. What is the cost of direct labor for the lawyer expressed in $ per customer

Answer 1

The cost of direct labor for the lawyer expressed in dollars per customer is $400.

Step-by-step explanation:

To calculate the cost of direct labor for the lawyer expressed in dollars per customer, we need to find the total cost of labor per customer. First, we need to find the total labor time per customer, which is given as 120 minutes. We can convert this to hours by dividing 120 by 60, which equals 2 hours.

Next, we need to find the total labor cost per customer. The lawyer has a wage rate of $200 per hour, so the total cost of labor per customer is 2 hours multiplied by $200, which equals $400. Therefore, the cost of direct labor for the lawyer expressed in dollars per customer is $400.

Answer 2

$800 per customer

Step-by-step explanation:

As demand is two customers per eight-hour day, one customer comes in 4 hours interval.

However, the lawyer takes 120 minutes or 2 hours to serve a customer. Although he takes 2 hours to serve one customer, he will receive eight-hours wages because of his efforts.

The cost of direct labor for the lawyer in one hour = $200 per customer

The cost of direct labor for the lawyer in four-hour = ($200 × 4 hours) per customer

= $800 per customer.

He will receive 4 hours of wages as the customers come in after 4 hours.