You Are a Cost Accountant for a Firm That Specializes

question 16

Essay

You are a cost accountant for a firm that specializes in "small" (under 10 billion dollars) defense contracts for specialty electronics products, such as fully portable, miniaturized CD-ROM imaging stations and global positioning transmitters/transponders. Your company is well respected in this field. One project up for competitive bids is a Field Service, Hands-Free, Individual Multi-Protocol Secure Communicator (a battlefield version of a cellular telephone, but built into each soldier's helmet, and containing necessary encryption technology). The Department of Defense wants 8 of these experimental devices to test their practicality. You have reviewed the contract specifications, and estimated that the first FSHFIMPSC should require 2350 hours, and that the product is subject to a 75% learning rate. All costs of the project (machine purchase, machine time, direct and indirect labor, and materials) have been bundled (allocated) into an hourly labor rate of $172 per hour. Determine the total project cost using the provided data.

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Definitions:

Electric Charge

A physical property of matter that causes it to experience a force when placed in an electromagnetic field.

Nucleus

The central and most important part of an atom, or a cell's organelle that contains genetic material.

Abundant Elements

Chemical elements that occur in large quantities in the Earth's atmosphere, crust, or oceans, or in the universe at large.

Human Body

The entire structure of a human being encompassing physical, biological, and chemical processes that work together to maintain life.