I would recommend quoting your list prices from the suppliers. And cover your overhead and profit on the labour side....
Just if they ask how much you are charging for the materials, give them suppliers list and then they can go ahead and check it out.
It doesn't matter how it gets spun, you have to cover your costs which includes your overhead and something for your profit.
I regularly tell my customers how much I pay for an item or two, so that they have an idea of my costs, but I still give them lump sum pricing that covers my costs, overhead and profit.... I just don't get into discussions about hourly rates or such...
Best of luck, cause these situations are difficult... hopefully it works out well.
Glen