Whitmer Corporation is working on its direct labor budget for the next two months. Each unit of output requires 0.07 direct labor-hours. The direct labor rate is $8.70 per direct labor-hour. The production budget calls for producing 6,000 units in February and 6,500 units in March. Required: Prepare the direct labor budget for the next two months, assuming that the direct labor work force is fully adjusted to the total direct labor-hours needed each month. (Round "labor-hours per unit"

Question

David Schmitt

Business

28 June, 07:19

Whitmer Corporation is working on its direct labor budget for the next two months. Each unit of output requires 0.07 direct labor-hours. The direct labor rate is $8.70 per direct labor-hour. The production budget calls for producing 6,000 units in February and 6,500 units in March. Required: Prepare the direct labor budget for the next two months, assuming that the direct labor work force is fully adjusted to the total direct labor-hours needed each month. (Round "labor-hours per unit"

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Jaiden Marshall · Answer 1

Instructions are below.

Explanation:

Giving the following information:

Each unit of output requires 0.07 direct labor-hours. The direct labor rate is $8.70 per direct labor-hour. The production budget calls for producing 6,000 units in February and 6,500 units in March.

We need to determine the total direct labor hours needed for each month.

February:

Total direct labor hours = 6,000*0.07 = 420 hours

Total direct labor costs = 420*8.7 = $3,654

March:

Total direct labor hours = 6,500*0.07 = 455 hours

Total direct labor costs = 455*8.7 = $3,958.5