Coburg Plumbing estimates that its overhead costs for the year will be $1,800,000 and it has decided to use direct labour hours as the cost driver. Its markup is 20% on cost. If a job for Martin S. used $400 of direct materials and 8 labour hours at $50 per hour how much will Coburg Plumbing charge Martin S?
A) $960
B) $800
C) $1360
D) cannot be calculated from the information given

Question

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The Answer of Coburg Plumbing estimates that its overhead costs for the year will be $1,800,000 and it has decided to use direct labour hours as the cost driver. Its markup is 20% on cost. If a job for Martin S. used $400 of direct materials and 8 labour hours at $50 per hour how much will Coburg Plumbing charge Martin S?
A) $960
B) $800
C) $1360
D) cannot be calculated from the information given

Coburg Plumbing Estimates That Its Overhead Costs for the Year