Question

The Federal government (and state and local governments as well) calculate billable rate as Billable rate -Wage rate + (Approved Overhead+ Indirect Costs) Factor x (Wage Rate) Given the following business costs for the previous year submitted for review and approval to a Federal agency: Expense Direct labor Cost $200,000 $140,000 Vacation pay, profit sharing health insurance, sick pay Advertising labor Office supplies $ 17,000 $25,000 35,000 $40,000 Insurance Rent Entertainment s 14,000 Travel (after required adjustments)$ 22,000 Taxes (after required adjustments) 28,000 $12,000 Utilities a) Determine the approvable overhead for this business b) Determine the billable rate for an engineer that is paid $50/hour

Answer 1

a The aoved oveshead ncude al ost on the in ome stte ment except the dinect labos, os dinect Expensey. Trus oves heod includs rent, toores advestising in sucance, interest, egal ,tele Phone bis. tavel expense, utilies etc The app10Val o es had fr, this ausiness thu3R1 include eveythingeiert deet labe Vacation sto utities tworel toe,entertaiment, vent, insuaance, otce supplie vtiig lake. hus,the appsoveà oveshead this busives is Sum of aul thee which exualy to $333,000 b The billobie sate ah enginees that is faid Rate unge Rate t CAP oed oueshead + Trdnect Ostỷ Bi lable Factolxage Rote Poved e heod 333,0oD Cs Scanned with CamScanner

Thdrbsect Costo Rate50+333,00o'so These foe, siab ニ50 + 16,650,000 $16165D, ogo t2 Cs Scanned with CamScanner