Computer Repair Inc. uses time and materials pricing, and each year it reviews its rates in light of the actual costs incurred in the prior year. Actual costs incurred last year in connection with repair work and in connection with the company's parts inventory are shown belovv Customers were billed for 20,000 hours of repair work last year. The company has a target prot of $10 per hour of repair service time and a target profit of 40% of the invoice cost of parts used. During the past year, the company billed repair service time at $50 per hour and added a materials loading charge of 40% to parts. Management feels these rates may now be inadequate, since costs have risen somewhat over the last year. Repairs Parts Repair technicianswages $486,666 Repair service managersalary 56,666 Parts managersalary $ 66,666 Repairs and parts assistantsalary 28,866 7,566 Retirement benefits (26% of salaries and wages) 112,966 13,566 Health insurance (5% of salaries and wages) 28,246 3,375 Utilities 126, 698 24, 836 Truck operating costs 19,266 Property taxes 9,286 5,466 Liability and fire insurance 6,726 3,666 Supplies 1,266 225 Rentebuilding 38,466 33,666 Depreciationtrucks and equipment 59,266 Invoice cost of parts used 666,666 Total costs for the year $966,666 $756,666 Required: 1. Using the above data, compute the following: a. The rate that would be charged per hour of repair service time using time and materials pricing. Cost of repair serwce $ 20,000 0 per lime hour Cost of materials per pricing $600300 9 hour b. The materials loading charge that would be used in billing jobs. The materials loading charge should be expressed as a percentage of the invoice cost. . . . $ Total materlals loading blll 1,150,000 a 390,000 6 % Total materials loading charge 2. Assume that the company adopts the rates that you have computed in (1} above. What should be the total price charged on a repair job that requires 6 hours of service time and parts with an invoice cost of $500? $ 1.1746 l