Exercise The following is known about the small construction company engaged in custom production: working hours available 3600 h/year fixed costs are estimated to be €30,000.00/year according to experience, variable overhead costs are 8% of the value of a working hour the company's management sets the company's profit target at €50,000.00/year The company receives a request for tender for a construction contract and determines the following information: Construction material for the contract €10,000.00 the cost of a working hour is €27.00/h the contract requires working hours of 100 h total work trips for the contract between the place of business and the construction site 200 km the mileage allowance charged to the customer is €0.70/km the rest of the 3,600 h annual capacity hours are used for other contracts to be sold a) Calculate the company's total margin and hourly rate Total margin Hourly rate € € b) Calculate the total price offer with value added tax for the construction contract based on the hourly margin principle. (24%tax)
Exercise The following is known about the small construction company engaged in custom production: working hours available 3600 h/year fixed costs are estimated to be €30,000.00/year according to experience, variable overhead costs are 8% of the value of a working hour the company's management sets the company's profit target at €50,000.00/year The company receives a request for tender for a construction contract and determines the following information: Construction material for the contract €10,000.00 the cost of a working hour is €27.00/h the contract requires working hours of 100 h total work trips for the contract between the place of business and the construction site 200 km the mileage allowance charged to the customer is €0.70/km the rest of the 3,600 h annual capacity hours are used for other contracts to be sold a) Calculate the company's total margin and hourly rate Total margin Hourly rate € € b) Calculate the total price offer with value added tax for the construction contract based on the hourly margin principle. (24%tax)
Fundamentals Of Construction Estimating
4th Edition
ISBN:9781337399395
Author:Pratt, David J.
Publisher:Pratt, David J.
Chapter13: Pricing Subcontractors' Work
Section: Chapter Questions
Problem 2RQ
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Transcribed Image Text:Exercise
The following is known about the small construction company engaged in custom production:
working hours available 3600 h/year
fixed costs are estimated to be €30,000.00/year
according to experience, variable overhead costs are 8% of the value of a working hour
the company's management sets the company's profit target at €50,000.00/year
The company receives a request for tender for a construction contract and determines the following information:
Construction material for the contract €10,000.00
the cost of a working hour is €27.00/h
the contract requires working hours of 100 h
total work trips for the contract between the place of business and the construction site 200 km
the mileage allowance charged to the customer is €0.70/km
the rest of the 3,600 h annual capacity hours are used for other contracts to be sold
a) Calculate the company's total margin and hourly rate
Total margin
Hourly rate
€
€
b) Calculate the total price offer with value added tax for the construction contract based on the hourly margin principle. (24%tax)
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