Shale Remodeling uses time and materials pricing. It is setting prices for next year using the following information:

Labor rate, including fringe benefits	$	88	per hour
Annual labor hours		8,200	hours
Annual materials purchase	$	1,396,250
Materials purchasing, handling, and storage	$	279,250
Overhead for depreciation, taxes, insurance, etc.	$	959,400
Target profit margin for both labor and materials		20	%

What should Shale set as rate per hour of labor hour?

Multiple Choice

• $266.

• $226.

• $158.

• $246.

• $205.