Dave's Electronic Repair Shop has budgeted the following time and material for 2011.

Dave's budgets 5,000 hours of repair time in 2011 and will bill a profit of $5 per labor hour along with a 30% profit markup on the invoice cost of parts. The estimated invoice cost for parts to be used is $100,000.
On January 5, 2011, Dave's is asked to submit a price estimate to fix a 72-inch flat-screen TV. Dave's estimates that this job will consume 20 hours of labor and $500 in parts.

Instructions
(a) Compute the labor rate for Dave's Electronic Repair Shop for the year 2011.
(b) Compute the material loading charge percentage for Dave's Electronic Repair Shop for the year 2011.
(c) Prepare a time-and-material price quotation for fixing the flat-screen TV.

Transcribed Image Text:

DAVE'S ELECTRONIC REPAIR SHOP Budgeted Costs for the Year 2011 Material Time Loading Charges Charges Shop employees' wages and benefits Parts managers salary and benefits Office employees salary and benefits $108,000 $25,400 13,600 Overhead (supplies, depreciation, advertising, utilities 26,000 18,000 $154,000 $57,000 20,000 Total budgeted costs