LFM Corporation makes and sells a product called Product WZ. Each unit of Produc

Question

LFM Corporation makes and sells a product called Product WZ. Each unit of Product WZ requires 2.8 hours of direct labor at the rate of $24.00 per direct labor-hour. Management would like you to prepare a Direct Labor Budget for June.

  
The budgeted direct labor cost per unit of Product WZ would be:

$24.00 per unit

$67.20 per unit

$37.60 per unit

$6.60 per unit

LFM Corporation makes and sells a product called Product WZ. Each unit of Product WZ requires 2.8 hours of direct labor at the rate of $24.00 per direct labor-hour. Management would like you to prepare a Direct Labor Budget for June.

Explanation / Answer

Labor Hours per unit               2.8

Labor rate per hour                $24.00

Labor cost per unit                  $67.20 (2.8 x $24.00)

Hence the correct option is $67.20

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