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The commonly-held estimate of billable time lies somewhere between 60-80 percent, which is known as the utilization rate. While that range may seem large (it is) and anything under 80 percent may sound low (it does), non-billables vary by industry, and many tasks deemed non-billables actually help companies grow.

For example, if you worked for 15 minutes at a rate of $100 per hour, you could use the chart to see that the time increment is 0.3. So, 0.3 x $100 = $30 to bill.

With a billing increment chart, most attorneys stick to a 1/10th of an hour rule, or 6-minute increments. This means if an attorney works for 15 minutes at a rate of $100 per hour, the chart will show that the time increment is 0.3. This is multiplied by the hourly rate ($100/hour) for a sum of $30.

What is billable utilization? Billable utilization measures the percentage of available hours that employees spend generating revenue for project-based services. The utilization rate formula is defined as: Billable Utilization % = (Number of Billable Hours / Number of Available Hours) X 100%.

For example, if a freelance writer charges $24 per hour and has a nine-minute meeting with a client, they can use the standard 15-minute increment chart to find that their time increment is 0.25. Then, they could calculate the bill by using the formula 0.25 x $24, which would equal $6.

But in a nutshell, it's important that you face it like this: the total amount of work you put on for each project must be divided by the total number of work hours. In the end, you'll have the final number of your billable rate.

Most attorneys use 6-minute increments (one-tenth of an hour) for clarity and efficiency during invoicing. Billing in smaller increments is time-consuming and laborious, while manual calculations are prone to human error.

Calculating billable hours is straightforward: you take how much you've worked and multiply it by your hourly rate.