Practice Problem 1

Suttons Electronic Repair Shop has budgeted the following time and material for 2020.

SUTTONS ELECTRONIC REPAIR SHOP Budgeted Costs for the Year 2020
		Time Charges			Material Loading Charges
Shop employees wages and benefits		$99,640
Parts managers salary and benefits						$25,400
Office employees salary and benefits		17,860				13,360
Overhead (supplies, depreciation, advertising, utilities)		28,200				19,380
Total budgeted costs		$145,700				$58,140

Suttons budgets 4,700 hours of repair time in 2020 and will bill a profit of $14 per labor hour along with a 24% profit markup on the invoice cost of parts. The estimated invoice cost for parts to be used is $102,000. On January 5, 2020, Suttons is asked to submit a price estimate to fix a 72-inch flat-screen TV. Suttons estimates that this job will consume 9 hours of labor and $300 in parts.

Compute the labor rate for Suttons Electronic Repair Shop for the year 2020. (Round answer to 2 decimal places, e.g. 10.50.)

Labour rate

$enter the labour rate per hour in dollars rounded to 2 decimal places

per hour

Compute the material loading charge percentage for Suttons Electronic Repair Shop for the year 2020.

Material loading percentage

enter the material loading percentage

%

Calculate the time-and-material price quotation for fixing the flat-screen TV.

Total price of labor and material

$enter the total price of labor and material in dollars