Ignatenko’s Custom Electronics (ICE) sells and installs complete security, computer, audio, and video systems for homes. On newly constructed homes it provides bids using time and material pricing. The following budgeted cost data are available.
| Time Charges | Material Loading Charges | ||||||
| Technicians’ wages and benefits | $128,000 | ||||||
| Parts manager’s salary and benefits | $34,600 | ||||||
| Office employee’s salary and benefits | 26,112 | 8,885 | |||||
| Other overhead | 13,760 | 36,660 | |||||
| Total budgeted costs | $167,872 | $80,145 | |||||
The company has budgeted for 6,400 hours of technician time during the coming year. It desires a $38.98 profit margin per hour of labor and a 100% profit on parts. It estimates the total invoice cost of parts and materials in 2014 will be $650,000.
Compute the rate charged per hour of labor.