9224.2     PRICING LABOR TIME
(New 10/74)

 

Generally, the pricing of labor time is not required for the accurate allocation of program costs.  However, there may be situations where because of the salary "mix", agencies may wish to price out labor time in order to be able to allocate various indirect costs accurately.  To price out labor, the labor time determined in Section 9224.1 is multiplied by an hourly charge rate.  The hourly charge rate may be determined by (a) estimating the hourly salaries and wages rate by position classification and (b) estimating the hourly salaries and wages rate by individual employee.

 

The allocation of costs will be accomplished as follows:

 

Labor time charged to each program  x  Hourly charge rate = Total labor cost chargeable to a program

 

Total labor cost chargeable to a program Total labor costchargeable to all programs

=

AllocationPercentage

x

Total indirect costs to be allocated

=

Indirect costs chargeable to a program

The total labor cost chargeable to a program computed above is not the actual cost, but rather a theoretical amount.  The allocation percentage could be used to distribute an organizational unit's salaries and wages costs to programs.