A carpenter earns $28 per hour. With payroll taxes, workers compensation, and benefits, the total hourly cost is $42. If the carpenter installs 40 linear feet of trim per hour, what is the labor cost per linear foot?
Correct Answer
B) $1.05
Use the total loaded labor cost of $42 per hour divided by 40 linear feet per hour = $1.05 per linear foot. The loaded rate includes all employment costs, not just the base wage.
Why This Is the Correct Answer
The correct answer is B ($1.05) because we must use the total loaded labor cost, not just the base wage. The loaded cost of $42 per hour includes all employment expenses like payroll taxes, workers compensation, and benefits. Dividing this total cost ($42) by the productivity rate (40 linear feet per hour) gives us the true labor cost per linear foot of $1.05.
Why the Other Options Are Wrong
Option A: $0.70
This answer uses an incorrect calculation method and doesn't properly relate the given loaded rate to the productivity measurement.
Option C: $1.68
This answer appears to double the base wage rate calculation ($28 ÷ 40 = $0.70 × 2 = $1.40), which is not the correct method for calculating loaded labor costs.
Memory Technique
Remember 'LOAD before you DIVIDE' - always use the LOADed labor rate (total cost including benefits) before DIVIDing by productivity to get unit costs.
Reference Hint
Construction estimating chapters covering labor burden rates and unit cost calculations
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