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Instructions Page

This spreadsheet is designed to help the owner of a business determine the overhead of a
business. Much of the information in this worksheet used to calculate overhead and profit of
the business is of a sensitive nature and should not be made available to others within the
company. For this reason, a companion Overhead Calculator is designed for use by
estimators within a company that are not owners.
Use this spreadsheet to calculate the average overhead for your company. This calculation
1 should be made at least once a year, but may be required more frequently if the sales for
your company has changed significantly.
Once you have calculated the Overhead % for your company, if you have additional
2 estimators in the company, notify them of the Overhead % they should use for estimating job
costs.
The estimators can then use the OverheadCalculator.xls (instead of
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OverheadCalculatorMaster.xls) to create customer hourly charge requirements for jobs.
CALCULATING OVERHEAD: Owners Only-Annually...Detailed information about
calculating overhead is available in the Cost and Estimating Guide Volume I Chapter
"Overhead". This spreadsheet applied the overhead to the hourly wage before calculation,
and the Cost and Estimating Guide applied it after job costs are estimated, but the two
processes will generate equal results. Go to the Overhead Worksheet. There are 3 key
values on this worksheet. They are Gross Sales, Field Labor and Net Profit. Other values
are included to enable you to determine what items should be included in the totals. This
step requires the use of the OverheadCalculatorMaster.xls spreadsheet.
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Go to the Overhead Worksheet. Enter your gross sales for the following year (or other documented period).
Enter your Field Labor costs for the same period. Field Labor costs should include cost of
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labor for employees who directly complete task items on a project list.
Enter as much detail as you need in the worksheet to feel comfortable that the 3 key values
6 accurately reflect your business financials. (Note the value labeled "Overhead as a
percentage of labor" in the upper right hand corner of the Overhead Worksheet.
CALCULATING LABOR HOURLY AVERAGE COST - Owners and Other Estimators
7 Before each job (you may use OverheadCalculatorMaster.xls or
OverheadCalculator.xls for this function.)
8 Go to the LaborHourlyAverageCost Worksheet.
9 Enter your personnel wage categories or individual wage earners if desired.
10 Ensure the Base Wage Per Hour for each person or group is accurate.
Enter the count of workers anticipated for this job. (For Example: For small jobs, maybe you
11 anticipate one journeyman and one apprentice. For difficult jobs, perhaps you anticipate at
least one master level worker.)
12 Enter the anticipated % of work performed by each category of worker. If all workers are
expected to work the entire job, then the calculator will automatically estimate this for you.
13 If overtime is expected, click Y in the Overtime Expected field and you will be allowed to enter
specifics about the overtime such as overtime rate, expected average overtime hours.
14 The worksheet will calculate the average hourly cost based on the information entered.
Go to the TotalsPage and you can determine calculations to use for two fields in PACER,
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LaborHourlyAverageCost and LaborHourlyAverageCharge.
16 Copy these numbers to PACER for use at the beginning of each project.

Overhead and Labor Cost Calculator


Totals Page
Copyright 2008 Oro Technologies,
Inc

Labor Hourly Avg Charge With Profit

Labor Gross Margin


(Profit/Total Price)
Labor Profit per Hour
(Labor Hourly Avg Cost Before Profit * Markup)
Labor Markup (Profit)

Labor Hourly Avg Cost Before Profit


(Overhead + Anticipated Labor Hourly Average
Cost)

Overhead
134%

Anticipated Labor Hourly Avg Cost


Calculate for this job/Review (Click Here)
Notes:

See PDCA Cost & Estimating Guide Vol I


Chapter "Overhead" for Details
For Use with PACER Estimating System
www.pacerestimating.com

67.43

In PACER, click File > New Project


Include this number in PACER
<- "File>New Project" field labeled
"Labor Hourly Customer Charge" (See below)

25%

16.73
33%

50.70

Include this number in PACER


<- "File>New Project" field labeled
"Labor Hourly Contractor Cost" (See above)
Perform annually or after any major expense adjustment

29.03 (new office, copier, phone system, management personnel)

21.67

Perform before each job.

LaborHourlyAverageCost

1. Labor Hourly Average Cost Calculator for Job


Labor Hourly Average Cost
Include Overtime? (Y/N)
Category

Estimate
d
Worker
Count

Anticipated Field Staff Required

Apprentice Level
Journeyman Level
Master Level
Subcontractor
Other
Other
Other
Other
Other
Joe
Steve
Scott
Other
Other

1
1

*Superintendent
*Field engineer
*Foreman
*Timekeeper/Bookkeeper
*Watchman
*Other
*Other

Confidential Proprietary

Base
Wage per
Hour

$
$
$
$

10.00
15.00
19.00
40.00

$
$
$
$
$

52.00
42.00
32.00
15.75
10.00

n
% of Job
Labor Hourly
Hours to be
Average Cost
Worked

100%

$ 21.67

33%
33%

$
$

10.00
15.00

33%

40.00

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LaborHourlyAverageCost

21.67

Notes

Worksheet intended for individual job.


Include:
List should include site personnel only
Does Not Include:
Field Staf who do not directly complete job
tasks.
Office Staf
Company Management
Any % of work included in overhead
Any portion of wage included in overhead
Any expense included in overhead
*In general, these functions are considered
overhead and should not be included here. In
some companies, these positions may be used
to complete tasks. If so, only the percentage of
actual time spent completing tasks should be
included here. The remaining percentage of
gross salary should be included in overhead %.

Confidential Proprietary

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