Question

Milano Corporation is working on its direct labor budget for the next two months. Each unit of output requires 0.50 direct labor-hours. The direct labor rate is $9.80 per direct labor-hour. The production budget calls for producing 6,400 units in October and 6,300 units in November. If the direct labor work force is fully adjusted to the total direct labor-hours needed each month, what would be the total combined direct labor cost for the two months

Answer 1

$62,230

Step-by-step explanation:

The computation of the total combined direct labor cost for the two months is presented below:

Particulars October November

A. Budgeted units to be produced 6,400 units 6,300 units

B. Direct labor hour per unit 0.50 0.50

C. Direct labor rate per hour $9.80 $9.80

D. Direct labor cost for the month (A × B × C)

$31,360 $30,870

Therefore the total combined direct labor cost is

= $31,360 + $30,870

= $62,230

We simply multiplied the number of units produced with the direct labor per unit and the direct labor rate per hour so that the direct labor cost could arrive