Direct labor rate, including fringe benefits. $36 per DLH Annual direct labor hours..... 10,000 hours Annual direct materials (parts) purchases.. $2,000,000 Annual overhead costs: Materials purchasing, handling, and storage.. $360,000 Non-materials related overhead (depreciation, insurance, taxes, rent) $170,000 Target profit margin (on both labor and materials).. 32% 1. Compute the rate per hour of direct labor (in $). 2. Compute the materials markup (in %). 3. What price should the company quote for a job requiring four direct labor hours and $580 in parts?

Direct labor rate, including fringe benefits. $36 per DLH Annual direct labor hours..... 10,000 hours Annual direct materials (parts) purchases.. $2,000,000 Annual overhead costs: Materials purchasing, handling, and storage.. $360,000 Non-materials related overhead (depreciation, insurance, taxes, rent) $170,000 Target profit margin (on both labor and materials).. 32% 1. Compute the rate per hour of direct labor (in $). 2. Compute the materials markup (in %). 3. What price should the company quote for a job requiring four direct labor hours and $580 in parts?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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