Question

For Gundy Company, units to be produced are 5,210 in quarter 1 and 6,500 in quarter 2. It takes 1.5 hours to make a finished unit, and the expected hourly wage rate is $15 per hour.Prepare a direct labor budget by quarters for the 6 months ending June 30, 2020.

Answer 1

Answer and Explanation:

The preparation of the direct labor budget by quarters is presented below:

GUNDY COMPANY

Direct Labor Budget, June 30, 2020

For the Six Months Ending June 30, 2020

Particulars Quarter 1 Quarter 2 Six months

Units

produced 5,210 6,500

Multiply

Direct labor

time per unit 1.5 hours 1.5 hours

Total

required direct

labors 7,815 9,750

Multiply Hourly

wage rate $15 $15

Total direct

labor cost $117,225 $146,250 $263,475