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AJ Accounting Services (AJCS) is a consulting company bidding for an auditing contract for El Kalif (EK), a foreign company. The contract requires that the winning company will have to audit twelve comparable branches of EK. Prior AJCS’ auditing experiences confirmed that the second audit took 210 hours, and the fourth 168 hours. AJCS charges $125/hour for this type of work. In the bidding proposal, AJCS stated that they would charge $250,000 for this contract (don’t have to consider bidding costs.) AJCS policy states that they must earn a 20% margin based on the total cost. Explain if AJCS’s bidding (the $250,000) is feasible.

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Operation Management, Management Studies

Category:- Operation Management
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