Question

Tracie corporation manufactures and sells women's skirts. each skirt (unit) requires 2.2 yards of cloth. selected data from tracie's master budget for next quarter are shown below: july august september budgeted sales (in units) 7,200 9,200 11,200 budgeted production (in units) 8,200 10,700 13,200 each unit requires 0.7 hours of direct labor, and the average hourly cost of tracie's direct labor is $20. what is the cost of tracie corporation's direct labor in september? multiple choice

O $224,000
O $156,800
O $184,800
O $264,000

Answer 1

To calculate Tracie Corporation's direct labor cost for September, multiply the budgeted production units by the hours of labor per unit, then multiply by the hourly labor cost. The cost of direct labor in September is $184,800.

Step-by-step explanation:

The student is presented with a question from the discipline of business finance and is required to calculate the cost of direct labor for Tracie Corporation in September. According to the data given in the master budget, the budgeted production in September is 13,200 units. Each unit requires 0.7 hours of direct labor, and the hourly cost of this direct labor is $20. To find the total cost of direct labor, we simply multiply the number of units by the hours of labor per unit, and then multiply the result by the hourly labor cost:

1. Calculate total hours of labor needed: 13,200 units * 0.7 hours/unit = 9,240 hours.
2. Calculate total labor cost: 9,240 hours * $20/hour = $184,800.

Therefore, the cost of Tracie Corporation's direct labor in September is $184,800.