Question

Second Chance Welding rebuilds spot welders for manufacturers. The following budgeted cost data for 2020 is available for Second Chance. Material Loading Time Charges Charges $192,400 Technicians' wages and benefits $39,600 Parts manager's salary and benefits Office employee's salary and benefits 51,800 9.400 Other overhead 14,800 19,600 Total budgeted costs $259,000 $68.600 The company desires a $39 profit margin per hour of labor and a 27.00% proft margin on parts. It has budgeted for 7,400 hours of repair time in the coming year, and estimates that the total invoice cost of parts and materials in 2020 will be $392,000. Compute the rate charged per hour of labor. Labor rate $ per hour Compute the material loading percentage. (Round answer to 3 decimal places, e.g. 10.501%.) Material loading percentage % Pace Corporation has requested an estimate to rebuild its spot welder. Second Chance estimates that it would require 38 hours of labor and $2,800 of parts. Compute the total estimated bill. (Round answer to 2 decimal places, eg. 10.50.) Total estimated bill

Answer 1

1
Budgeted cost per labor hour	35.00	=259000/7400
Add: Profit margin	39.00
Labor rate	74.00	per hour
2
Material loading charges	17.50%	=68600/392000
Add: Profit on parts	27.00%
Material loading percentage	44.50%
3
Labor charges	2812.00	=38*74
Materials parts	2800.00
Material loading charges	1246.00	=2800*44.50%
Total estimated bill	6858.00