Business, 06.05.2020 04:31 marqueen1

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 $132,804
Parts manager's salary and benefits $34,000
Office employee's salary and benefits 23,380 11,000
Other overhead 15,401 48,675
Total budgeted costs $171,585 $93,675

The company has budgeted for 5,580 hours of technician time during the coming year. It desires a $38.86 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 $750,000.

a. Compute the rate charged per hour of labor.
b. Compute the material loading percentage.
c. RCE has just received a request for a bid from Buil Builders on a $1,200,000 new home. The company estimates that it would require 80 hours of labor and $40,000 of parts. Compute the total estimated bil.

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