Question
Rey Custom Electronics (RCE) sells and installs complete security, computer, audio, and video systems for homes. On newly constructed homes it provides bids using time-and-material
Rey Custom Electronics (RCE) sells and installs complete security, computer, audio, and video systems for homes. On newly constructed homes it provides bids using time-and-material pricing. The following budgeted cost data are available.
Time Charges | Material Loading Charges | ||||||
Technicians' wages and benefits | $126,500 | - | |||||
Parts manager's salary and benefits | - | $34,900 | |||||
Office employee's salary and benefits | 25,300 | 15,710 | |||||
Other overhead | 12,100 | 43,380 | |||||
Total budgeted costs | $163,900 | $93,990 |
The company has budgeted for 5,500 hours of technician time during the coming year. It desires a $38 profit margin per hour of labor and an 80% profit on parts. It estimates the total invoice cost of parts and materials in 2020 will be $723,000.
1. Compute the rate charged per hour of labor. (Round answer to 2 decimal places, e.g. 10.50.)
Labor rate | $ | per hour |
2. Compute the material loading percentage.
Material loading percentage | % |
3.
RCE has just received a request for a bid from Buil Builders on a $1,208,000 new home. The company estimates that it would require 80 hours of labor and $39,600 of parts. Compute the total estimated bill.
|
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