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A Local Engineering Firm Is Bidding on a Design Project

question 175

Essay

A local engineering firm is bidding on a design project for a new client. The total budgeted direct-labor costs for the firm are $400,000. The total budgeted indirect costs are $600,000. It is estimated that there are 8,000 billable hours in total.
Required:
a.What is the budgeted direct-labor cost rate?
b.What is the budgeted indirect-cost rate assuming direct-labor cost is the allocation base?
c.What should be the engineering firm bid on the project if the direct labor hours are estimated at 300 hours?


Definitions:

American Liberty League

A conservative political organization formed in 1934, opposing the New Deal and advocating for free enterprise and limited government.

Unionize

The process of organizing employees into a labor union which negotiates with employers for wages, working conditions, and other employment rights.

Trade Unions

Organizations that represent the collective interests of workers in negotiations with employers regarding wages, work conditions, and rights.

American Liberty League

A conservative political organization formed in 1934, opposing the New Deal of President Franklin D. Roosevelt and advocating for free enterprise and limited government.

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