Calculating Hourly Cost Rates In Project-Based Industries Part 2: cost management
Peer reviewed, Journal article
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Hourly cost rates are crucial project costing due to the substantial proportion of labor costs in projects. Yet, there is little published about calculating hourly cost rates, and it is a contentious topic in corporations. Therefore, an approach is provided in this paper that will improve the calculation of hourly cost rates. It is based on a novel approach to Activity-Based Costing (ABC) and a revised version of the CAM-I Capacity Model which is adopted to projectbased industries. Both an example and a case are provided to allow detailed discussions.