A property management company furnishes skilled help to maintain apartment complexes. If employees are paid $16 per hour and the company wishes to maintain a 30% markup based on the employees’ hourly pay, what hourly rate should it bill property owners?
a. $11.20
b. $12.30
c. $20.80
d. $22.86
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$20.80
Yes, that's correct.
To calculate the hourly rate that the property management company should bill property owners, we need to add the employee's hourly pay and the desired markup.
1. First, calculate the markup amount:
Markup = Employee's Hourly Pay * Markup Percentage
Markup = $16 * 30% = $4.80
2. Add the markup amount to the employee's hourly pay to get the hourly rate to bill property owners:
Hourly Rate = Employee's Hourly Pay + Markup
Hourly Rate = $16 + $4.80 = $20.80
So, the correct answer is (c) $20.80.