Staples - Johnstown 590 Galleria Dr, Johnstown PA 15904 Phone Number: (814) 262-9096
The distribution of manufacturing overhead costs to individual product unit, or production batches generally, requires a base or a cost driver, to which reference a rate, known as material burden rate applies. Material burden is the amount of manufacturing overhead costs that a unit of the base carries.
Burden rate is defined as the total indirect contract costs, calculated as a percentage of the construction company's direct labor. In other words, for every dollar of direct labor allocated to a contract, burden is applied as a percentage of the direct labor. But before a contactor can accurately calculate burden rate, all contract costs assumed by the company must be fully accounted for and factored into the final burden rate equation.