Question

Smith Corporation makes and sells a single product called a Pod. Each Pod requires 3.0 direct labor-hours at $11.20 per direct labor-hour. The direct labor workforce is fully adjusted each month to the required workload. Smith Corporation is preparing a Direct Labor Budget for the second quarter of the year. In June the company has budgeted to produce 23,600 Pods. Budgeted direct labor costs incurred in June would be:

Answer 1

$792,960

Step-by-step explanation:

Data provided

Number of pods = 23,600

Direct labor hours = 3

Direct Labor Rate per hour = $11.20

The computation of Budgeted direct labor costs is shown below:-

Budgeted Direct labor Cost = Number of pods × Direct Labor Hours required per pod × Direct Labor Rate per hour

Budgeted Direct labor Cost = 23,600 × 3 × $11.20

= $792,960