Chick-Fil-A is the Lord's Dinner (CLD) manufacturers those sweet, heavenly, golden waffle fries. They are in the process of creating their budgets for their direct labor. The sales budget estimated total sales revenue of $48,000. Each unit of fries is sold for $4.00 each. Additional relevant information has been provided below: Beginning finished goods inventory: 3,500 units Desired ending finished goods inventory: 2,000 units Direct labor per unit: 0.5 hours Direct labor wage rate: $10.00 Based on the information provided, what is the total budgeted direct labor costs?
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
Chick-Fil-A is the Lord's Dinner (CLD) manufacturers those sweet, heavenly, golden waffle fries. They are in the process of creating their budgets for their direct labor. The sales budget estimated total sales revenue of $48,000. Each unit of fries is sold for $4.00 each. Additional relevant information has been provided below: Beginning finished goods inventory: 3,500 units Desired ending finished goods inventory: 2,000 units Direct labor per unit: 0.5 hours Direct labor wage rate: $10.00 Based on the information provided, what is the total budgeted direct labor costs?
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