Accounting 9706 · AS & A Level · Costs and cost behaviour

Costs and cost behaviour — practice question

An employee does a $35$-hour week and earns an hourly rate of $24$. On top of her basic pay, she is given a bonus equal to $25\%$ of her hourly rate. This is worked out from the time saved compared with the target number of units produced. Each unit is expected to take $15$ minutes to make. During a $35$-hour week she made $170$ units. From these, $2$ units were rejected and her overall pay was cut by $2.50$ for each unit. What were her wages for the week?

  • A$840$
  • B$880$
  • C$885$
  • D$890$

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