The following are budgeted data: One pound of material is required for each fini
ID: 2553038 • Letter: T
Question
The following are budgeted data:
One pound of material is required for each finished unit. The inventory of materials at the end of each month should equal 25% of the following month's production needs. Purchases of raw materials for February would be budgeted to be:
Garrison 16e Rechecks 2017-10-03
Multiple Choice
20,925 pounds
20,575 pounds
20,275 pounds
18,325 pounds
,
Depasquale Corporation is working on its direct labor budget for the next two months. Each unit of output requires 0.61 direct labor-hours. The direct labor rate is $8.70 per direct labor-hour. The production budget calls for producing 6,700 units in May and 7,100 units in June. If the direct labor work force is fully adjusted to the total direct labor-hours needed each month, what would be the total combined direct labor cost for the two months?
Multiple Choice
$35,556.90
$37,679.70
$36,618.30
$73,236.60
January February March Sales in units 16,600 23,200 19,600 Production in units 19,600 20,600 19,300Explanation / Answer
Answer 1 Calculation of Purchases of raw materials for February February Production in Units 20600 x Raw material required per unit (in pounds) 1 Total raw material required for production (in pounds) 20600 Add: Ending Inventory (25% of 19300 pounds) 4825 Less : Beginning Inventory (25% of 20600 pounds) 5150 Raw material purchases (in pounds) 20275 The answer is 20275 pounds Answer 2 Calculation of the total combined direct labor cost for the two months May June Total Production units 6700 7100 x Direct Labour hours required per unit 0.61 0.61 Total Direct Labour hours 4087 4331 x Direct Labour rate per hour $8.70 $8.70 Direct Labour Cost $35,556.90 $37,679.70 $73,236.60 The answer is $73,236.60
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