A-1 Appliance provides repair services for all makes and models of home appliances. A-1 Appliance charges customers for labour on each job at a rate of $50 per hour. The labour rate is high enough to cover actual technician wages of $20 per hour and shop overhead (allocated at a cost of $12 per hour), and to provide a profit. A-1 Appliance charges the customer “at cost” for parts and materials. A recent customer job consisted of $37 in parts and materials and two hours of technician time.
1. What was A-1 Appliance’s cost for this job? Include shop overhead in the cost calculation.
2. How much was charged to the customer for this repair job?