Question

Forty Winks Corporation manufactures night stands. The production budget shows that Forty Winks Corporation plans to produce 2 comma 000 night stands in March and 1 comma 300 night stands in April. Each night stand requires 0.5 direct labor hours in its production. Forty Winks Corporation has a direct labor rate of $ 13.00 per direct labor hour. What is the total combined direct labor cost that Forty Winks Corporation should budget in March and​ April?A. $36,400B. $27.300C. $12.600D. $14,700

Answer 1

$21,450

Step-by-step explanation:

In March,

Total direct labor hours required:

= Production budget × Direct labor hour required per unit

= 2,000 × 0.5

= 1,000 hours

Total direct labor cost = Total direct labor hours required × Direct labor hour per rate

= 1,000 hours × $13

= $13,000

In April,

Total direct labor hours required:

= Production budget × Direct labor hour required per unit

= 1,300 × 0.5

= 650 hours

Total direct labor cost = Total direct labor hours required × Direct labor hour per rate

= 650 hours × $13

= $8,450

Combined direct labor cost = $13,000 + $8,450

= $21,450