Question

It is estimated that 33,000 direct labor-hours would be required for the period's estimated level of production. The company also estimated $532,000. What is the estimated direct labor cost per hour?

1) $16.12
2) $16.18
3) $16.24
4) $16.30

Answer 1

The estimated direct labor cost per hour is calculated by dividing the total estimated labor cost by the estimated number of labor hours, which in this case, equals $16.12 per hour.

Step-by-step explanation:

The student is asking about calculating the estimated direct labor cost per hour based on the total estimated labor hours and the total estimated cost. To calculate the direct labor cost per hour, you divide the total estimated labor cost by the estimated number of labor hours.

To find the cost:

1. Identify the total estimated labor cost: $532,000.
2. Identify the estimated labor-hours: 33,000 hours.
3. Divide the total estimated labor cost by the estimated labor-hours to get the labor cost per hour: $532,000 / 33,000 hours = $16.12 per hour.