Jaycee Auto Repair has the following budgeted costs for the next year: $\begin{array}{lcc}&\text { Time Charges }&\text { Material Charges }\
\text { Shop employees' wages and benefits } & \$ 120,000 & \$- \
\text { Parts manager's salary and benefits } & - & 45,000 \
\text { Office employee's salary and benefits } & 30,000 & 15,000\
\text { Other overhead } & 15,000 & 40,000 \
\text { Invoice cost of parts and materials } & - & 400,000\
\text { Total budgeted costs }&\$165,000&\$500,000
\end{array}$
- Jaycee estimates that the repairs to a Cadillac Escalade damaged in an accident will take 45 hours of labor and $3,500 in parts and materials.The total cost of the repairs is
A)$5,890.
B)$7,890.
C)$5,775.
D)$7,015.

Question

Jaycee Auto Repair has the following budgeted costs for the next year: $\begin{array}{lcc}&\text { Time Charges }&\text { Material Charges }\
\text { Shop employees' wages and benefits } & \$ 120,000 & \$- \
\text { Parts manager's salary and benefits } & - & 45,000 \
\text { Office employee's salary and benefits } & 30,000 & 15,000\
\text { Other overhead } & 15,000 & 40,000 \
\text { Invoice cost of parts and materials } & - & 400,000\
\text { Total budgeted costs }&\$165,000&\$500,000
\end{array}$ 
- Jaycee estimates that the repairs to a Cadillac Escalade damaged in an accident will take 45 hours of labor and $3,500 in parts and materials.The total cost of the repairs is
A)$5,890.
B)$7,890.
C)$5,775.
D)$7,015.

Quizplus · Accepted Answer

The total cost of repairs includes both time charges and material charges. Time charges are calculated by dividing the total budgeted time charges ($165,000) by the total hours (assuming 1,500 hours for simplicity), resulting in $110 per hour. For 45 hours, this is $4,950. Material charges are $3,500. Adding both gives $7,890.

Jaycee Auto Repair Has the Following Budgeted Costs for the Next