Question

Answer the following questions using the information below:

Shamokin Manufacturing produces a Tourbillon watch movement called OM362. Shamokin expects to sell 10,000 units of OM362 and to have an ending finished inventory of 2,000 units. Currently, it has a beginning finished inventory of 800 units. Each unit of OM362 requires two labor operations, one labor hour of assembling and two labor hours of polishing. The direct labor rate for assembling is $10 per assembling hour and the direct labor rate for polishing is $12.50 per polishing hour.

*47) The expected number of hours of direct labor for OM362 Bigger is ________.*
A) 8,800 hours of assembling; 17,600 hours of polishing
B) 11,200 hours of assembling; 22,400 hours of polishing
C) 17,600 hours of assembling; 8,800 hours of polishing
D) 22,400 hours of assembling; 11,200 hours of polishing

Answer 1

The expected number of hours of direct labor for the OM362 is 11,200 hours of assembling and 22,400 hours of polishing, as each unit requires 1 hour of assembling and 2 hours of polishing to be produced. The correct option is B.

Step-by-step explanation:

To calculate the expected number of hours of direct labor for OM362, we use the information provided about the operations required for each unit. As stated, each OM362 unit requires one labor hour of assembling and two labor hours of polishing.

Shamokin Manufacturing plans to sell 10,000 units and expects to end with 2,000 units in inventory, which implies the production will be the sum of units sold and ending inventory minus the beginning inventory (10,000 + 2,000 - 800 = 11,200 units).

To find the total assembling hours, we multiply the number of units (11,200) by the hours required for assembling (1 hour), which results in 11,200 hours of assembling. For total polishing hours, we multiply the same number of units by the hours required for polishing (2 hours), yielding 22,400 hours of polishing.

Therefore, the expected number of hours of direct labor for OM362 is 11,200 hours of assembling and 22,400 hours of polishing, which corresponds to option B.