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John’s Custom Electronics (JCE) 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.Technicians’ wages and benefits Parts manager’s salary and benefits Office employee’s salary and benefits Other overheadTotal budgeted costsTime Charges$150,000 —28,000 15,000$193,000Material Loading Charges— $34,00012,000 42,000$88,000The company has budgeted for 6,000 hours of technician time during the coming year. It desires a $38 profit margin per hour of labor and a 100% profit on parts. It estimates the total invoice cost of parts and materials in 2011 will be $700,000.Instructions(a) Compute the rate charged per hour of labor. (Round to two decimal places.) (b) Compute the material loading percentage. (Round to two decimal places.) (c)JCE has just received a request for a bid from Sublette Builders on a $1,200,000 newhome. The company estimates that it would require 80 hours of labor and $40,000 of parts. Compute the total estimated bill.
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