Question

Four employees at a fast-food restaurant each perform one of the four activities in serving a customer: greet customer, take order, process order, and deliver order. The processing time for each activity is given as follows: Activity Processing time per customer Greet customer 2 seconds Take order 30 seconds Process order 60 seconds Deliver order 5 seconds Assume demand is unlimited. If each employee is paid $7.50 per hour, what is the cost of direct labor associated with serving one customer

Answer 1

Answer:

$0.5 per customer

Explanation:

The computation of the cost of the direct labor is shown below:

Since the processing time is given, so we take the minimum time out of available ones

Greet customer = 1  ÷ 2 seconds

Take order  = 1 ÷ 30 seconds

Process order = 1 ÷ 60 seconds

Deliver order = 1 ÷ 5 seconds

Minimum is 1 ÷ 60 seconds

Now total customer per hour is

=   1 ÷ 60 seconds × 60 × 60

= 60 customer pee hour

And, for total employee, the paid cost is

= $7.50 × 4

= $30 per hour

So, the cost of direct labor is

= $30 per hour ÷ $60 per hour

= $0.5 per customer