Padong Remanufacturing rebuilds spot welders for manufacturers. The following budgeted cost data for 2016 are available for Padong:

The company wants a $30 profit margin per hour of labour and a 20% profit margin on parts. It has budgeted for 7,600 hours of repair time in the coming year, and estimates that the total invoice cost of parts and materials in 2016 will be $400,000.
Instructions
(a) Calculate the rate charged per hour of labour.
(b) Calculate the material loading percentage. (Round to three decimal places.)
(c) Lindy Corporation has asked for an estimate on rebuilding its spot welder. Padong estimates that it would require 40 hours of labour and $2,000 in parts. Calculate the total estimated bill.

Transcribed Image Text:

Time Charges $228,000 Technicians' wages and benefits Parts manager's salary and benefits Office employee's salary and benefits Other overhead Total budgeted costs Material Loading Charges $42,500 24,000 9,000 38,000 15,200 $281,200 $75,500