Joses Electronic Repair Shop has budgeted the following time and material for 2014. Joses budgets 5,000 hours
Question:
Joses budgets 5,000 hours of repair time in 2014 and will bill a profit of $5 per labor hour along with a 30% profit markup on the invoice cost of parts. The estimated invoice cost for parts to be used is $100,000.
On January 5, 2014, Joses is asked to submit a price estimate to fix a 72-inch flat screen TV. Joses estimates that this job will consume 5 hours of labor and $200 in parts.
Instructions
(a) Compute the labor rate for Joses Electronic Repair Shop for the year 2014.
(b) Compute the material loading charge percentage for Joses Electronic Repair Shop for the year 2014.
(c) Prepare a time-and-material price quotation for fixing the fl at-screenTV.
Step by Step Answer:
Managerial Accounting Tools for business decision making
ISBN: 978-1118096895
6th Edition
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso