Rates and Markups |
The Rates and Markups tab of the Shop Activity - Setup - Options screen enables you to display and define rates for and markups to the price of labor and parts.
Shop activity management options
The fields in the bottom section of this tab define the rates and markups. Unless otherwise indicated, these fields are required.
Average system labor rate
Single labor rate that is applied to all labor in all shops. If this number is not zero (0), it is used to calculate ALL labor costs for work orders in all locations and to calculate standard costs. If this number is zero (0), refer to Determining labor rates to learn the process used to determine labor rates.
Standard tolerance percentage
Percentage to add to all cost and labor standards during cost analysis. Actual cost or labor items are identified as exceptions only when they exceed the standard as adjusted by this percentage. Managers can use this percentage to fine-tune the standard (it can be changed between runs of exception reports) and also to filter out exceptions that have values very close to the standard. Refer to Data -> Shop Activity -> Work Order Center .
Markup percentages
Markup percentages can help recover indirect costs associated with the direct costs of providing labor and parts to equipment units. Markup percentages for internal and outside charges are set and a specific set of rules is followed to automatically add these percentages to the cost of each individual labor or part charged on a work order. If the Specify markups by location field is blank, the percentages in this field is used for all locations.
The format is xxx.xx. For example, 13.41 specifies 13.41%.
The following items have fields for both internal and outside markup percentages:
Labor: See rules for labor markup percentages .
Parts: Markup percentage applied to the cost of the part, if appropriate. See Determining parts markup percentages.
Commercial labor: See rules for labor markup percentages .
Commercial parts: See rules for parts markup percentages.
The markup charges are added to work orders for costs posted on the Data -> Shop Activity -> Work Order Center , Work Order – Short Form , and Commercial Work Charges screens, and the Data -> Parts Repair -> Internal Rebuilds screen.
On work for outside customers keep costs billed to customer ________ internal costs
Specifies which values from the Markup percentages field are used to compute markups associated with the cost of labor or parts charged to work orders performed on equipment units with an ownership of CUSTOMER (specified on the Data -> Equipment Units -> Fleet Equipment screen).
SEPARATE FROM:
If the work order is an estimate it uses the outside percentage for parts and labor
If the work order is not an estimate it uses the internal percentage for parts and labor
TOGETHER WITH: The outside percentage is used for labor or parts
Specify markups by location
If there are checks in the following fields, when you post labor and parts charges, the location’s appropriate markup percentage specified in the Markup percentages fields on the Rates and Markups tab of the Data -> Setup -> Organization Structure -> Locations -> Primary Information screen is used. See Determining parts markup percentages.
Labor
Parts
Commercial labor
Commercial parts
Source location of parts markup
If you have selected to specify parts markups by location, use this field to specify whether part overhead is based on the shop location or the issue location. By default, this option is set to SHOP.