Question

Zhang Industries budgets production of 220 units in June and 230 units in July. Each unit requires 1.5 hours of direct labor. The direct labor rate is $12.40 per hour. The indirect labor rate is $19.40 per hour. Compute the budgeted direct labor cost for July.

Answer 1

Budgeted direct labor cost for July = $4,278

Step-by-step explanation:

Given:

Production in July = 230 units

Hours of direct labor = 1.5 hours per unit

Direct Labor rate = $12.40 per hour

Indirect labor rate = $19.40 per hour.

Find:

Budgeted direct labor cost for July

Computation:

Budgeted direct labor cost for July = (Production in July)( Hours of direct labor)( Direct Labor rate)

Budgeted direct labor cost for July = (230)(1.5)(12.4)

Budgeted direct labor cost for July = $4,278