Dave's Stove-Top Popcorn currently has three full-time employees who are each paid $1,500 per month. An employee can only work a maximum of 100 hours per month because production normally takes place at night. They do receive $1,500 even if they do not work 100 hours, however. Part-time employees can be hired at a cost of $25 per hour. Dave's Stove-Top Popcorn has forecasted that demand for the next six months will be as follows:
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C. $40,750
Explanation:
Full-time employee cost = 4 × $1,500 × 6 = $36,000
Needed hours = 0 + 0 + 50 + 20 + 120 + 0 = 190 hours needed × $25.00 = $4,750
Total labor cost = $36,000 + $4,750 = $40,750.
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