Question
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
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 | $204,400 | - | ||||||
Parts manager's salary and benefits | - | $40,700 | ||||||
Office employee's salary and benefits | 58,400 | 12,722 | ||||||
Other overhead | 29,200 | 20,950 | ||||||
Total budgeted costs | $292,000 | $74,372 |
The company desires a $35.00 profit margin per hour of labor and a 26.00% profit margin on parts. It has budgeted for 7,300 hours of repair time in the coming year and estimates that the total invoice cost of parts and materials in 2017 will be $419,000.
a) Compute the material loading percentage.
b) Pace Corporation has requested an estimate to rebuild its spot welder. Second Chance estimates that it would require 39 hours of labor and $2,700 of parts. Compute the total estimated bill.
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