Procedures - TB-43-0002-710008

TB 43-0002-71

8. Procedures. The following direct and indirect costs will apply to determine repair cost estimates when deficiencies are

found during technical inspections.

a. Direct Costs.

(1) Direct labor. Direct labor is that labor (civilian or military) which can be specifically identified to the

repair/overhaul job to be performed. Direct labor involves only personnel in direct productive contact with the item or

service involved.

(a) Direct labor costs. To estimate direct labor costs, determine/estimate the labor manhours to be

applied and apply the appropriate computed direct labor hourly rate to these man-hours.

(b) Direct labor man-hours. The determination of the direct labor man-hours to be applied will be based

on man-hour requirements for maintenance tasks listed in applicable equipment publications; commercial flat rate

manuals, when appropriate; similar work performed previously; or individual experience. The direct labor man-hours will

be periodically reviewed and updated, if necessary.

will perform the work. Procedures described in AR 37-1 will be used to convert man-years to average productive working

hours when civilian labor pay scales are stated in terms of annual salaries. Labor rates, whether determined from annual

salaries of hourly wage rates, will be computed (to include provisions for the cost of annual, sick, and other leave, and

government contributed fringe benefits) in accordance with AR 37-1.

(d) Military labor rates. Labor rates used for military personnel will be the average military wage rate for

the work center performing the work, based on standard rates published in AR 37-1.

(e) Labor rates including indirect expenses. Major Army commanders and heads of agencies may

establish and use standard hourly rates for direct labor (including indirect or overhead) so long as such rates are

consistent with AR 37-1. When such rates are established, separate rates will be established for each category of

supportable items or weapons systems (e.g., aircraft, automotive equipment, combat vehicles, construction equipment,

electronics and communications equipment, missile systems, ships, munitions armament, weapons armament, rail

equipment, general equipment, and commodity groups of equipment) ; depot maintenance and direct/general support

maintenance; and each major geographical area where wage levels vary significantly.

(f) Depot maintenance labor rate. When considered necessary for determining the proper depot

maintenance labor rate, assistance may be requested as authorized by AR 700-4.

(2) Materials. The cost to repair will include all materials directly applied to and identifiable with the particular

equipment undergoing repair.

(a) Consumable items received from the supply system may be costed as billed by the supply ag ency. If

no billing is available, consumables will be costed at the standard inventory price as published in appropriate supply

manuals. Items procured from local sources will be priced at the latest invoice cost. Cost of items fabricated will be

based on actual cost for like items, where possible. When actual cost is not available, engineering estimates, including

indirect expenses, will be used.