Cost per labor hour

[pholberton]

Since I am new at using Microsoft Project, may I get direction on how to
account for fringe beneifits Vacation, weekends, sick time) and how that
enters into calculating a standard labor rate to be applied to tasks?
Thank you,
pvh

 

[John]

Since I am new at using Microsoft Project, may I get direction on how to
account for fringe beneifits Vacation, weekends, sick time) and how that
enters into calculating a standard labor rate to be applied to tasks?
Thank you,
pvh

Phil,
I guess the best way to account for a rate structure that includes
overhead and fringe is to include those factors in the Standard Rate
value.

Some users like to have a dual rate setup so they can see cost versus
price and there are ways of doing that in Project, but be aware that
Project is NOT a financial planning application, it is a planning and
schedule application.

John
Project MVP

 

[Jan De Messemaeker]

Hi,

Project starts when your question is solved... you need this standard rate
to calculate the cost of tasks. Project is of no help calculating this rate.
From experience: every cost acountant has his or her formula and thinks it's
the only valid one in the universe )

 

[Steve House [MVP]]

I generally suggest to my students that as a starting point they sit down
with the CFO or comptroller of their organization and between them devise a
strategy. Most of the time there are standard rates already in place that
are used by department heads for staff planning and budgeting that take into
account salaries, benefits, hiring costs, facilities costs (ie, desks,
telephones, etc), on-going training, and so forth. You may have 10
engineers in the research department whose salaries range from $50k to $100k
depending on seniority etc but for planning next year's personel budget the
department head uses an average standard rate of $75k per head. That's
often a good starting point for your project budgets as well.