Shale Remodeling uses time and materials pricing. It is setting prices for next year using the following information:

Labor rate, including fringe benefits $ 75 per hour

Annual labor hours 6,350 hours

Annual materials purchases $ 1,206,250

Materials purchasing, handling, and storage $ 241,250

Overhead for depreciation, taxes, insurance, etc. $ 666,750

Target profit margin for both labor and materials 25 %

What should Shale set as rate per hour of labor hour?

$250.

$200

$150

$225

$180