Refilwe is a young entrepreneur who owns a small venture that manufactures toiletry chemicals. Last week she came across a tender advertised in the Times Magazine. The client, a cleaning company needs to contract a company to produce different batches of toiletry chemicals. Refilwe is doing the costing for the tender. She has the following information available. The following are the costs of typical batch of 100 chemicals. Direct materials Direct labour Machine set up Design Prime cost 30 10 15 58 Direct employees are paid on a piecework basis. Refilwe's company absorbs production overheads at a rate of 20% of direct wages cost. 5% is added to total production cost of each batch to allow for selling, and administration overheads. 1. Refilwe requires a profit margin of 25% on the tender. If she is contracted to produce a batch of 300 chemical, what is her tender price. (10)
