Senior attendant should be selected for the firm as the total estimated hourly cost incurred is less as compared to junior attendant.
The labor cost per unit is obtained by multiplying the direct labor hourly rate by the time required to complete one unit of a product.
As per the given information,
Arrival rate is 8 per hour
Rate paid per hour is $20 Junior attendant rate is $5 per hour
Senior attendant rate is $12 per hour
Service rate of junior attendant is 10per hour
Service rate of senior attendant is 16per hour
Total cost of machinist per hour is $20
Calculation of total estimated hourly cost is as follows:
In case of Senior Attendant:
[tex]\rm\, Average \,no. \,of \,Customers \; in \; the \; Service \; System = \frac{Arrival \;Rate }{Service \; rate - Arrival \;rate} \\\ \rm\, Average \,no. \,of \;customers \;in \; the \; service \; system = \dfrac{8}{16-8} \\\\\rm\, Average \,no. \,of \; customers \;in \;the \; service \; system = 1\\\\\\[/tex]
[tex]\rm\,Average\; time\; spent \;in\; the\; system = \dfrac{1}{\rm\,Service \;rate - Arrival\; rate}\\\\\rm\,Average\; time \;spent \;in \;the\; system = \dfrac{1}{\rm\,16 - 8}\\\\\Average\; time \;spent \;in\; the \;system = 0.125\\\\Total \;Cost = Cost \;for\; machinist\; per \;Hour \times Average\; number\; of \,Customers \;in\; the \;System \times Average\; Time \;spent + Cost \;of \;Server\\\\Total \,Cost = 20\times1\times0.125 + 12 \\\\\rm\,Total\, Cost = \$14.5[/tex]
In case of Junior Accountant by applying the similar formula we can get,
[tex]\rm\, Average \,no. \,of \; Customers \;in \;the \; Service \; System = 4\\\\\Average Time\; Spent\; in\; the \;system = 0.5\\\\Total\, cost = 20\times 4\times\times 0.5 + 5\\\\Total\, cost = \$ 45[/tex]
Therefore, it can be concluded that Senior attendant should be selected for the firm as the total estimated hourly cost incurred is less as compared to junior attendant.
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