SE 8-4 Direct Labor Budget LO8-5 luction manager of for the upcoming fiscal year
ID: 2564425 • Letter: S
Question
SE 8-4 Direct Labor Budget LO8-5 luction manager of for the upcoming fiscal year: 1st Quarter2nd Quarter 3rd Quarter 4th Quarter Units to be produced 8,000 6,500 7,000 7,500 Each unit requires 0.35 direct labor-hours, and direct laborers are paid $12.00 per hour. Required . Using Schedule 4 as your guide, prepare the company's direct labor budget for the upcoming fiscal year. Assume that the direct labor workforce is adjusted each quarter to match the num- ber of hours required to produce the forecasted number of units produced 2 Prepare the company's direct labor budget for the upcoming fiscal year, assuming that the direct labor workforce is not adjusted each quarter. Instead, assume that the company's direct labor workforce consists of permanent employees who are guaranteed to be paid for at least 2.600 hours of work each quarter. If the number of required direct labor-hours is less than this number, the workers are paid for 2,600 hours anyway. Any hours worked in excess of 2,600 hours in a quarter are paid at the rate of 1.5 times the normal hourly rate for direct labor.Explanation / Answer
1) 1 2 3 4 year units to be produced 8,000 6,500 7,000 7,500 29,000 Direct labor time per unit (hours) 0.35 3.5 0.35 0.35 0.35 total direct labor hours needed 2800 2275 2450 2625 10150 direct labor cost per hr 12 12 12 12 12 total direct labor cost 33600 27300 29400 31500 121800 2) 1 2 3 4 year units to be produced 8,000 6,500 7,000 7,500 Direct labor time per unit (hours) 0.35 3.5 0.35 0.35 total direct labor hours needed 2800 2275 2450 2625 regular hours paid 2,600 2,600 2,600 2,600 overtime hours paid 200 25 Wages for regular hours 31200 31,200 31,200 31,200 124800 overtime wages 3600 450 4050 total direct labor cost 34800 31,200 31,200 31,650 128,850
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