Coburg Plumbing Estimates That Its Overhead Costs for the Year

Multiple Choice

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