Please do carefully because i sent the same question before and last two was wro
ID: 2543875 • Letter: P
Question
Please do carefully because i sent the same question before and last two was wrong So dont say %92 for 2. and Dont say 1062.88 for 3.
Exercise M-9
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Please do carefully because i sent the same question before and last two was wrong So dont say %92 for 2. and Dont say 1062.88 for 3.
Exercise M-9
Rey Custom Electronics (RCE) 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 $146,456 - Parts manager's salary and benefits - $34,500 Office employee's salary and benefits 26,139 8,520 Other overhead 14,232 40,295 Total budgeted costs $186,827 $83,315
The company has budgeted for 5,670 hours of technician time during the coming year. It desires a $38.37 profit margin per hour of labor and an 80% profit on parts. It estimates the total invoice cost of parts and materials in 2017 will be $717,000.
Explanation / Answer
(a) Compute the rate charged per labor hour
146456 / 5670 = 25.82
26139 / 5670 = 4.61
14232 / 5670 = 2.51
Total hourly cost 186827 = 32.94
Profit margin = 38.37
Rate charged per labor hour = 71.31
(b) Calculate material load percentage = material loading charges / total invoice cost of parts and material 717000
34500+8520 = 43020 / 717000 = 0.06
other overhaed 40295 / 717000 = 0.05
Total = 83315 / 717000 = 0.11
Add: Profit margin 80% = 0.8
Material loading percentage = 0.91
(c) Job: Build a new home
Labor charges (84 hrs x 71.31) = 5990.04
Material charges:
Cost of parts material 39100
Material loading percentage(39100x91%) 35581 = 74681
Total price of labor & material = 80671.04