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SADCO Consulting Firm has the following budget for 2021: Revenues $25,000,000 Direct costs 8,000,000 Indirect costs 14,000,000 Net Operating Income 3,000,000 SADCO has a single
SADCO Consulting Firm has the following budget for 2021: Revenues $25,000,000 Direct costs 8,000,000 Indirect costs 14,000,000 Net Operating Income 3,000,000 SADCO has a single direct cost exemplified by professional consultants, which is taken as an allocation base. A markup of 14% is used for pricing the assigned job. SADCO bidding on a consulting job for Ajman University. The required professional consultation could be categorized as follows: Professional Category Budgeted Rate per Hour Budgeted Hours Category A $200 10 hours Category B 150 12 Category 00 Category D 180 40 75 Required: (A) Compute the budgeted indirect cost rate. (B) How much will SADCO bid for the job? (C) What would be the case if the markup is taken as 10% of the revenue
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