Compute the labor rate for joses electronic repair shop

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Reference no: EM13888797

Jose's Electronic Repair Shop has budgeted the following time and material for 2014.

Jose's Electronic Repair Shop Budgeted Costs for the Year 2014

 Material

Time Charges

Loading Charges

Shop employees' wages and benefits Parts manager's salary and benefits

$108,000

$25,400

Office employee's salary and benefits

23,500

13,600

Overhead (supplies, depreciation, advertising, utilities)

26,000

16,000

Total budgeted costs

$157,500

$55,000

Jose's budgets 5,000 hours of repair time in 2014 and will bill a profit of $5 per labor hour along with a 30% profit markup on the invoice cost of parts. The estimated invoice cost for parts to be used is $100,000.

On January 5, 2014, Jose's is asked to submit a price estimate to fix a 72-inch flat- screen TV. Jose's estimates that this job will consume 5 hours of labor and $200 in parts.

Instructions

(a) Compute the labor rate for Jose's Electronic Repair Shop for the year 2014.

(b) Compute the material loading charge percentage for Jose's Electronic Repair Shop for the year 2014.

(c) Prepare a time-and-material price quotation for fixing the flat-screen TV.

Reference no: EM13888797

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