Waterways use time and material pricing when it bids on irrigation projects. Budgeted data for 2009 are as follows.
Waterways Corporation
Budgeted Costs for Irrigation Projects for 2009
____________________________Time Charges___Material Loading Charges
Labor wages (5,760 hours)……………$240,000
Supervisor’s salary………………………………………………………$60,000
Clerical and accountant wages…………..60,000…………………………4,000
Irrigation supplies manager………………………………………………40,000
Overhead…………………………………53,950………………………..21,000
Total…………………………………..$353,950…………………….$125,000
Waterways have budgeted for 5,760 labor hours. It desires a $12 profit margin per hour of labor and 15% profit on materials. It estimates the total invoice cost of materials in 2009 will be $642,000.
Instructions
(a) Compute the rate per hour of labor.(Round to two decimal places.)
(b) Compute the material loading charge.(Round to two decimal places.)
(c) Waterways have received a request for a bid to do a parkway for the city. The irrigation manager estimates that it will take about a month to complete the project and require 480 hours of labor and $80,000 of materials. Compute the total estimated bid for the parkway project.
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