Exercise 22-8

Second Chance Welding rebuilds spot welders for manufacturers. The following budgeted cost data for 2017 is available for Second Chance.

			Time Charges			Material Loading Charges
	Technicians' wages and benefits		$202,800				-
	Parts manager's salary and benefits		-				$39,300
	Office employee's salary and benefits		39,000				14,375
	Other overhead		7,800				28,980
	Total budgeted costs		$249,600				$82,655

The company desires a $39.00 profit margin per hour of labor and a 28.00% profit margin on parts. It has budgeted for 7,800 hours of repair time in the coming year, and estimates that the total invoice cost of parts and materials in 2017 will be $414,000.

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Compute the rate charged per hour of labor. (Round answer to 2 decimal places, e.g. 10.50.)

Labor rate

$

per hour

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Compute the material loading percentage. (Round answer to 3 decimal places, e.g. 10.501.)

Material loading percentage

%

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Pace Corporation has requested an estimate to rebuild its spot welder. Second Chance estimates that it would require 39 hours of labor and $2,100 of parts. Compute the total estimated bill. (Round answer to 2 decimal places, e.g. 10.50.)

Total estimated bill

$

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