Exercise 8-8 (Video)

Second Chance Welding rebuilds spot welders for manufacturers. The following budgeted cost data for 2020 is available for Second Chance.

			Time Charges			Material Loading Charges
	Technicians' wages and benefits		$244,900				-
	Parts manager's salary and benefits		-				$40,000
	Office employee's salary and benefits		71,100				10,960
	Other overhead		7,900				24,960
	Total budgeted costs		$323,900				$75,920

The company desires a $37 profit margin per hour of labor and a 21.00% profit margin on parts. It has budgeted for 7,900 hours of repair time in the coming year, and estimates that the total invoice cost of parts and materials in 2020 will be $416,000.

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Compute the rate charged per hour of labor.

Labor rate

$enter the rate charged per hour of labor in dollars.

per hour

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

Material loading percentage

enter the material loading percentage rounded to 3 decimal places %

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Pace Corporation has requested an estimate to rebuild its spot welder. Second Chance estimates that it would require 43 hours of labor and $2,000 of parts. Compute the total estimated bill. (Round answer to 2 decimal places, e.g. 10.50.)

Total estimated bill

$enter the total estimated bill in dollars rounded to 2 decimal places