Question

M publishers budgeted production of 79,500 diaries in 2012. each diary requires assembly. assume that 12 minutes are required to assemble each diary. if assembly labor costs $14.50 per hour, determine the direct labor cost budget for 2012.

Answer 1

For each diary we have the following rule of three:
14.50 $ ------> 60 minutes
x --------------> 12 minutes
Clearing x we have:
x = (12/60) * (14.50)
x = 2.9 $
Then, for all the diary we have that the cost is:
(2.9) * (79500) = 230550 $
Answer:
the direct labor cost budget for 2012 is:
230550 $