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Cost Rates for Staff

What is the best way to calculate a true cost figure for an employee to use as the cost amount for billing by staff rate for determining P&L on jobs.

Thanks, Denise

I'm not sure my way is the best way, but I have used it for about 9 yrs now. My accountant told me, so you may want to verify with your accountant. I take all the known amounts and breakdown to an hrly rate: salaries, insurance, car expenses, taxes and anything else you may pay for that particular resource, then mark up 35%. If you have any other questions, please feel free to call at 800-273-8484. I will be back in office after first of year. Happy Holidays!!

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If a salaried employee: divide annual salary by 2080 hours for cost. Then you can add burden anyway you choose.

Personally, I use the cost of employer taxes and the "cost" of downtime in my burden number. My calculation goes like this: salary divided by (2080*85%=1,768) + employer taxes = staff cost.

Roxanne Cowan