Question

Presented below are data relating to labor for Verde Appliance Repair Shop. Repair-technicians' wages $127,600 Fringe benefits 32,300 Overhead 68,850 The desired profit margin per hour is $19.12. The material loading charge is 60% of invoice cost. Verde estimates that 5,000 labor hours will be worked next year. If Verde repairs a dishwasher that takes 1.5 hours to repair and uses parts of $77.69, compute the bill for the job. (Round answer to 2 decimal places, e.g. 10.50.) Total cost $

Answer 1

first let us know the hourly rate of labour:

	Total cost	Total hours	Per hour charge
repair technicians wages	$127,600	5,000	$25.52
fringe benefits	$32,300	5,000	$6.46
overhead	$68,850	5,000	$13.77
total	$228,750	5,000	$45.75
		add: profit margin	$19.12
		Hourly labour rate	$64,87

now,

the cost of job:

labour 1.5 hours @$64.87 per hour =>$64.87*1.5		$97.305
add:cost of materials	$77.69
add : loading on material ($77.69*60%)	46.614	$124.304
Total cost		$221.61