Question

MatchPoint Racket Company manufactures two types of tennis rackets, the Junior and Pro Striker models. The production budget for March for the two rackets is as follows:

Junior Pro Striker
Production budget 8,100 units 19,500 units

Both rackets are produced in two departments, Forming and Assembly. The direct labor hours required for each racket are estimated as follows:

Forming Department Assembly Department
Junior 0.25 hour per unit 0.50 hour per unit
Pro Striker 0.30 hour per unit 0.70 hour per unit

The direct labor rate for each department is as follows:

Forming Department $17.00 per hour
Assembly Department $9.00 per hour

Required:
Prepare the direct labor cost budget for March.

Answer 1

See below

Step-by-step explanation:

The preparation of direct labor cost budget for March is seen below;

Particulars Foaming department Assembly department

Production 8,100 units 19,500 units

Hours required

Junior 2,025 4,050

Hours required

Pro 5,850 13,650

Total hours

Department Wise (A) 7,875 17,700

Total Hourly rate (B) $17 $19

Total direct labor cost (A × B) $133,875 $336,300

••Workings

For Junior, it would be :

Foaming

= 0.25 hour per unit × 8,100 units

= 2,025

Assembly

= 0.50 hour per unit × 8,100 units

= 4,050

For Pro, it would be:

Foaming

= 0.30 hour per unit × 19,500 units

= 5,850

Assembly

= 0.70 hour per unit × 19,500 units

= 13,650