Ch. 8 Budgeted Direct Labor Cost Formula Please provide the formula for solving the Budgeted Direct Labor Cost and show an example. Thanks
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Ch. 8 Budgeted Direct Labor Cost Formula
Please provide the formula for solving the Budgeted Direct Labor Cost and show an example.
Thanks
The budgeted direct labor cost indicate the cost of direct labor and the number of labor hours to be used in budgeted period.
Following is the formula of Budgeted Direct Labor Cost:
Particulars | 1st Q | 2nd Q | 3rd Q | 4th Q | Year |
Total Units (A) | XXX | XXX | XXX | XXX | XXXX |
Direct Labor ( Per Unit) (B) | XX | XX | XX | XX | XX |
Total number of direct labor hours required (C) = (A*B) | XXXX | XXXX | XXXX | XXXX | XXXX |
Direct Labor (Per hour cost) (D) | XXX | XXX | XXX | XXX | XXX |
Total cost of direct labor (E) = (C*D) | XXXX | XXXX | XXXX | XXXX | XXXX |
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