Your client is either an idiot or an a$$hole.

Some people have only ever worked for an hourly or salaried wage. If they work for a salary most are able to divide by the hours they work to come up with an hourly rate for what they do. There are idiots that don’t understand the difference between billing rate and wage rate. I have actually had low end prospects ask my labor rate and then come out and say “I don’t make that much and I’m a …”. They are completely oblivious to the fact that what I bill is not what I make after expenses AND more importantly what they do for a living has no correlation to what I charge.

Since you say your client is in business I’m betting he is just an a$$hole. He knows full well that you bill more then you pay your tech, if not the business closes. Like sirroundsound said he may be trying to figure out how much you pay your techs so he can go around you and hire them on the side. I would use what SoundSD said and then take Rob Grabon’s advice and ask if there was a problem. If he has a problem with the rate DON”T try to further justify your rates. He already knows what goes into a billing rate. If he is happy with the service then tell him that’s what if costs to provide that level service. If he wants to shop around for someone else cheaper that is fine. The only way you lose is if you agree to charge him less than your normal rate.