- 6 Bina Cepat Sdn Bhd Company Has Been Awarded An Excavation Contract Of A Trench With A Dimension Of 3 Feet Wide By 1 1 (69.47 KiB) Viewed 31 times
- 6 Bina Cepat Sdn Bhd Company Has Been Awarded An Excavation Contract Of A Trench With A Dimension Of 3 Feet Wide By 1 2 (55.88 KiB) Viewed 31 times
6. Bina Cepat Sdn. Bhd. Company has been awarded an excavation contract of a trench with a dimension of 3 feet wide by 10,000 feet length with a 5 feet deep. The trench is located somewhere in Pahang. There are two methods to execute the project namely Method 1 and 2. The labor cost is at a rate of RM 2 per hour for a duration of 8 hours a day. Method1 : Excavate the trench using mainly locals whom can accomplish 0.5-yard volume of the trench in 1 hour. (Notes: 1 yard = 3 feet). There are ten (10) local workers each day. Method2: Excavate the trench using the specialized rented excavator from Kuala Lumpur (KL) which can accomplish 0.5-yard volume of the trench in 1 minute. The rent cost is RM 250 per day including the travelling from KL to the site and going back from the site to KL Two (2) days are needed for going back and forward and the cost of the transportation is RM 4,000 for round trip. The operator has to be shipped out from KL at a charge of RM 150 per day (for his services and maintenance of the machine) including the travelling days for going back and forth for the work. The round- trip flight cost for the operator is RM 400 and needed 1 day to travel to the site. The duration of work for the operator is for 8 hours per day. If the machine is to be used, the company still needs three (3) local workers to complete the works. Assume all the rent for the machine and the operator and local workers' wages are fully paid according to the number of working days. Determine the best method to execute the project.
6. Method 1: Total cost = RM 22,240 Method 2: Total cost = RM 16,452 Select Method 2 due to the lowest cost incurred