Portion of FTE Devoted to Activity 100% Total Salary 34,000 Benefit % 24.96% Benefit Amount 8,486 Total Salary and Benefits 42,486 Hours per year 2,080 less: Vacation hours -120 Holiday hours -96 Sick Leave hours -64 Non-Productive hours -100 Portion of FTE Devoted to Activity 100% equals: Chargable (Productive) hours 1,700 Total Salary and Benefits 42,486 divided by: Chargable Hours 1,700 equals: Hourly Recharge Rate $24.99 PRODUCTIVE TIME CALCULATION The estimate of productive hours used in calculating recharge rates is determined by deducting vacation, holiday, and sick hours usage from available working hours. Also deducted are non-productive hours used for items such as training, general maintenance, clean-up, etc. The productive hours are those hours that are expected to be rechargable. When determining productive time the following method should be used: The department needs to take into account differences in employee vacation accruals and non-productive hours. Determination of sick-leave usage and non- productive hours can be estimated using past experience of the department as a guide. A description of the activities included within non-productive hours must be included within the rate proposal to support the productive time calculation. Recharge Personnel Hourly Rate Calculations Account Name Department to complete green shaded areas Account/Fund (copy columns as necessary for additional personnel) Name Group Rate Title Annual Salary Projected Merit and/or Range* Portion of FTE Devoted to Activity Total Salary 0 0 0 0 Benefit % Benefit Amount 0 0 0 0Total Salary & Benefits Total Salary and Benefits 0 0 0 0 0 Hours per year 2,080 2,080 2,080 2,080 less: Vacation hours Holiday hours Sick Leave hours Non-Productive hours Portion of FTE Devoted to Activity 0% 0% 0% 0% Chargable Hours equals Chargable (Productive) Hours: 0 0 0 0 0 Total Salary and Benefits 0 0 0 0 0 divided by Chargable Hours: 0 0 0 0 0 equals Hourly Recharge Rate: (formulas are embedded in form) * Effective date of projected merit and/or range This calculation can be used when a group rate is charged to users Hourly Group Recharge Rate Recharge Personnel Hourly Rate Calculations Total Salary & Benefits SAMPLE RATE CALCULATION ACTIVITY WHOSE SERVICES ARE MAINLY LABOR Projected Operating Costs Sub 1 Salaries 100,000 Sub 2 General Assistance 50,000 Sub 6 Employee Benefits 30,660 Subtotal Labor Costs 180,660 Sub 3 Supplies & Expenses 10,000 Sub 5 Equipment Depreciation 9,340 Sub 7 Other (Describe) Total Operating Expense 200,000 Adjustment for Prior Years' Operations Deduct Surplus or Add Deficit 0 Adjusted Total 200,000 Estimate Productive Hours 1,700 (from Productive Time calculation) Hourly Rate 117.65 $ Notes: 1) 2) For an activity, such as a machine shop, whose recharge rates are composed of charges for labor and materials, the rate is normally an hourly rate and can be calculated as follows: This is a summary schedule and the preparer needs to provide information on individual calculations associated with each cost component (I.e., salaries, supplies, etc.). Benefit percentages can be based on "Employee Benefit Data" provided in attachment to Income and Recharge Guidelines or actual amounts from department's payroll distribution reports. SAMPLE RATE CALCULATION MARK-UP ON STOCK ITEMS Projected Operating Costs Sub 1 Salaries 100,000 Sub 2 General Assistance 50,000 Sub 6 Employee Benefits 30,660 Subtotal Labor Costs 180,660 Sub 3 Supplies & Expenses 10,000 Sub 5 Equipment Depreciation 9,340 Sub 7 Other (Describe) Total Operating Expense 200,000 Adjustment for Prior Years' Operations Deduct Surplus or Add Deficit 0 Adjusted Total 200,000 Projected Cost of Material to be Resold 1,500,000 Calculation of Mark-Up Rate: Total Expenses Percentage Cost of Materials Mark-Up on Cost 200,000 1,500,000 Equals 13.33% Rates for activities such as storerooms, which provide stock items to users, should be based on the cost of the merchandise plus a mark-up to cover the salaries and other operating expenses of the function. For a storehouse operation there may be a single mark-up rate applicable to all stocked items, or multiple rates based on categories of merchandise. The mark-up percentages may be calculated as follows: Equals SAMPLE RATE CALCULATION ACTIVITY THAT PRODUCES GOODS OR TESTING SERVICES Projected Operating Costs Sub 1 Salaries 100,000 Sub 2 General Assistance 50,000 Sub 6 Employee Benefits 30,660 Subtotal Labor Costs 180,660 Sub 3 Supplies & Expenses 10,000 Sub 5 Equipment Depreciation 9,340 Sub 7 Other (Describe) Total Operating Expense 200,000 Adjustment for Prior Years' Operations Deduct Surplus or Add Deficit 0 Adjusted Total 200,000 Estimate Productive Hours 1,700 (from Productive Time calculation) Hourly Labor Rate 117.65 $ Per Minute Labor Rate 1.96 $ (hourly rate divided by 60) Notes: 1) Many recharge activities provide a range of services that require many different rates. These areas must develop a list or catalog of rates. Rates for individual items are determined by calculating labor and other costs for each item. The first step is to calculate an hourly labor rate which will recover general operating expenses. If needed, the hourly rate can be reduced to a per-minute rate. Included in the hourly labor rate are some "general" support expenses that support the employee and are not part of any materials to be charged separately. INDIVIDUAL RATE CALCULATION Service Description COLOR PRINT COLOR SLIDE Detail Unit Cost Detail Unit Cost Annual Item Production 100,000 100,000 Labor per Item in Minutes 2.00 1.00 Labor Cost per Minute 1.96 1.96 Labor Cost per Item 3.92 1.96 Material Cost per Item Paper 4,000.00 0.04 10,000.00 0.10 Solution 2,000.00 0.02 5,000.00 0.05 Subtotal Materials 6,000.00 0.06 15,000.00 0.15 Special Equipment Maintenance 30,000.00 0.30 35,000.00 0.35 Special Equipment Depreciation 10,000.00 0.10 15,000.00 0.15 Subtotal 40,000.00 0.40 50,000.00 0.50 Per Item Rate $4.38 $2.61 REVENUE & EXPENSES SUMMARY Revenues: (List all services provided) Volume Rate Total Color Print 100,000 $4.38 438,000 Color Slides 100,000 $2.61 261,000 Total Revenues 699,000 Expenses: (Summarizes general operating & item specific costs) Salaries 100,000 General Assistance 50,000 Employee Benefits 30,660 Supplies 10,000 General Equipment Depreciation 9,340 Special Equipment Depreciation 25,000 Equipment Maintenance 65,000 Materials 21,000 Total Expenses 311,000 Net Profit: (Total Revenues - Total Expenses) 388,000 STEP 1 - Estimate Annual Usage of Each Item # Item Usage (Days) Total Usage (Days) 10 Tape Recorders 200 2,000 20 Camcorders 150 3,000 Total Usage in Days 5,000 STEP 2 - Calculate Per-Day General Operating Expenses Projected Operating Expenses Sub 1 Salaries 25,000 Sub 2 General Assistance - Sub 6 Employee Benefits 5,000 Subtotal Labor Costs 30,000 Sub 3 Supplies & Expenses 3,000 Sub 5 Equipment Depreciation 2,000 Sub 7 Other - Total Operating Expense 35,000 Adjustment for Prior Year's Operations Deduct Surplus or Add Deficit - Adjusted Total 35,000 Estimated Usage in Days 5,000 Operating Expenses Per Day $7.00 An activity which offers equipment or instruments for rental or use can develop a rate for an individual item, such as a microscope. Rates for classes or groupings of like items, such as computers, overhead projectors, or camcorders are also possible. The following is an example of this type of rate calculation: EQUIPMENT RENTAL OR USE SAMPLE RATE CALCULATION EQUIPMENT RENTAL RATES Service Description TAPE RECORDERS CAMCORDERS Detail Unit Cost Detail Unit Cost Annual Usage in Days 2,000 3,000 Operating Expenses per Day 7.00 7.00 Special Equipment Maintenance 1,000.00 0.50 1,000.00 0.33 Special Equipment Depreciation 3,000.00 1.50 2,000.00 0.67 Subtotal 4,000.00 2.00 3,000.00 1.00 Per Item Rate $9.00 $8.00 REVENUE & EXPENSES SUMMARY Revenues: (List all services provided) Volume Rate Total Tape Recorders 2,000 $9.00 18,000 Camcorders 3,000 $8.00 24,000 Total Revenues 42,000 Expenses: (Summarizes general operating & item specific costs) Salaries 25,000 Employee Benefits 5,000 Supplies 3,000 General Equipment Depreciation 2,000 Special Equipment Depreciation 5,000 Equipment Maintenance 2,000 Total Expenses 42,000 Net Profit: (Total Revenues - Total Expenses) -