Question

The budgeted production of​ Capricorn, Inc. is 13 comma 000 units per month. Each unit requires 40 minutes of direct labor to complete. The direct labor rate is $ 100.00 per hour. Calculate the budgeted cost of direct labor for the month.​ (Round any intermediate calculations to the nearest cent and your final answer to the nearest​ dollar.)

Answer 1

The budgeted cost of direct labor for Capricorn, Inc. to produce 13,000 units in a month is $866,667, after calculating the total labor hours and multiplying by the labor rate of $100 per hour.

Step-by-step explanation:

To calculate the budgeted cost of direct labor for the month, we first need to determine the total labor hours needed to produce 13,000 units. Since each unit requires 40 minutes of direct labor, we can calculate the total labor minutes required and then convert this to hours:

Total labor minutes = 13,000 units × 40 minutes/unit = 520,000 minutes

Total labor hours = 520,000 minutes ÷ 60 minutes/hour = 8,666.67 hours

Next, we multiply the total labor hours by the direct labor rate to find the budgeted cost of direct labor:

Direct labor cost = 8,666.67 hours × $100.00/hour = $866,667

Thus, the budgeted cost of direct labor for the month is $866,667 when rounded to the nearest dollar.

Answer 2

budgeted cost of direct labor for the month ​$ 866,666.67

Step-by-step explanation:

expected production: 13,000 units

minutes per units: 40

labor cost per hours: $100

Cost per unit: $100/60 minutees per hour x 40 minute per unit = $66.67

Total labor cost budgeted for the month:

expected production x labor cost per unit:

13,000 units x $ 66.67 = $ 866,666.67