Profit on parts, The company has budgeted for 6,350 hours

Profit on parts

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Reference no: EM13913563

Ignatenko's Custom Electronics (ICE) 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	$165,100	-
Parts manager's salary and benefits	-	$33,580
Office employee's salary and benefits	29,083	9,328
Other overhead	14,351	41,888
Total budgeted costs	$208,534	$84,796

The company has budgeted for 6,350 hours of technician time during the coming year. It desires a $37.72 profit margin per hour of labor and a 100% profit on parts. It estimates the total invoice cost of parts and materials in 2014 will be $680,000.

Compute the rate charged per hour of labor.

Labor rate

per hour

Compute the material loading percentage.

Material loading percentage			%

ICE has just received a request for a bid from Buil Builders on a $1,205,000 new home. The company estimates that it would require 81 hours of labor and $38,000 of parts. Compute the total estimated bill.

Total estimated bill

Reference no: EM13913563

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Profit on parts

Reference no: EM13913563

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