Daniel, Inc., plans to produce 6000 ceramic vases. Total budgeted FMOH is $6000. Information regarding the budgeted variable costs are given below: Input standard Price standard Direct materials 2 lbs $1.50 /lb Direct labor 2 hr $14/hr Variable MOH 2 hr $2/hr Fixed MOH Hint: Add Fixed MOH per unit produced (budgeted FMOH/ budgeted production) The following inventory levels apply to 20X4: Beginning inventory Ending inventory Direct materials 1200 lbs 8000 lbs WIP 0 units 0 units Finished goods 400 vases $5600 500 vases What is the estimated cost of direct labor for planned production?
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.
Daniel, Inc., plans to produce 6000 ceramic vases. Total budgeted FMOH is $6000. Information regarding the budgeted variable costs are given below:
| Input standard | Price standard | ||
| Direct materials | 2 lbs | $1.50 /lb | |
| Direct labor | 2 hr | $14/hr | |
| Variable MOH | 2 hr | $2/hr | |
| Fixed MOH |
Hint: Add Fixed MOH per unit produced (budgeted FMOH/ budgeted production)
The following inventory levels apply to 20X4:
| Beginning inventory | Ending inventory | |
| Direct materials | 1200 lbs | 8000 lbs |
| WIP | 0 units | 0 units |
| Finished goods | 400 vases $5600 | 500 vases |
What is the estimated cost of direct labor for planned production?
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