quick question, if a 1 man shop has $1000 a month in fixed overhead expense, and a 10 man (all field workers) has a $9500 a month fixed overhead....
who has more overhead?
The 10-man shop has more overhead. The 1-man shop has more overhead/hr. The 1-man shop needs to charge more per man hour to cover his fixed expenses.
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If there are 172 working hours in a month. (4.3 wks x 40 hrs/wk)
The 1-man shop needs to charge ($1000/172) =
$5.81/hr to cover his fixed expenses.
The 10-man shop needs to charge ($9500/(172 x 10)) =
$5.52/hr to cover the fixed expense.
Frank