Green Consultants Pty Ltd specialise in consulting on landscape design. The company developed a predetermined charge-out rate

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Green Consultants Pty Ltd specialise in consulting on landscape design. The company developed a predetermined charge-out rate based on hours for each of its consultants on 1 July 2016 to assign the cost of labour directly associated with each client job for the coming year. The company employs four consultants who each work 40 hours per week for 48 weeks of the year; 20% of each consultant’s total yearly labour time is not directly chargeable to client jobs. The budgeted total labour cost for one of the consultants, G. Smith, is $92 160.

Required
Determine the hourly charge-out rate to be assigned as labour cost to all client jobs on which G. Smith works to 30 June 2017. (Ignore GST.) If Smith worked for 1 500 hours for clients during the year, what is the total labour cost for Smith?

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Accounting

ISBN: 978-1118608227

9th edition

Authors: Lew Edwards, John Medlin, Keryn Chalmers, Andreas Hellmann, Claire Beattie, Jodie Maxfield, John Hoggett

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