Required information The following information applies to the questions displaye

Question

Required information The following information applies to the questions displayed below. FreshPak Corporation manufactures two types of cardboard boxes used in shipping canned food, fruit, and vegetables The canned food box (type C) and the perishable food box (type P) have the following material and labor requirements Tvpe of Box Direct material required per 100 boxes: Paperboard ($0.38 per pound) Corrugating medium ($0.19 per pound) 40 pounds 30 pounds 80 pounds 40 pounds Direct labor required per 100 boxes ($19.00 per hour) 0.20 hour 0.40 hour The following production-overhead costs are anticipated for the next year. The predetermined overhead rate is based on a production volume of 455,000 units for each type of box. Production overhead is applied on the basis of direct-labor hours Indirect material Indirect labor Utilities Property taxes Insurance Depreciation Total S 13,800 82,710 42,000 28,000 21,000 50,000 237,510

Explanation / Answer

Solution:

Part 4 --- Direct labor Budget

Direct Labor Budget

Box C

Box P

Total

Production requirement (number of boxes)

(refer note 1)

455,000

455,000

Direct labor required per box (hour)

0.002

0.004

Direct labor required for production (hours)

910

1820

$2,730

Direct Labor Rate

$19

Total direct labor cost

$51,870

Note 1 --

Production Budget

Box C

Box P

Sales

460,000

460,000

Plus: Desired Ending Inventory Dec 31

7500

17500

Total Units needed

467500

477500

Less: Expected Beginning Inventory Jan 1

12500

22500

Production Requirements

455000

455000

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For Part 5 --- Please provide the format or tabs or options to fill in the box. Since it is confusing..

Direct Labor Budget

Box C

Box P

Total

Production requirement (number of boxes)

(refer note 1)

455,000

455,000

Direct labor required per box (hour)

0.002

0.004

Direct labor required for production (hours)

910

1820

$2,730

Direct Labor Rate

$19

Total direct labor cost

$51,870

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