Paul White is preparing a direct labor budget. His sales budget shows total sales units of 15900 and sales dollars of $18700. The direct materials purchases budget shows materials to be purchased of 15900 units and budgeted purchases cost of $3950. The production budget indicates a total of 12100 units to be produced. Standard direct labor hours per unit is 0.40 and the standard average wage rate is $14. What is budgeted direct labor cost?
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.
Paul White is preparing a direct labor budget. His sales budget shows total sales units of 15900 and sales dollars of $18700. The direct materials purchases budget shows materials to be purchased of 15900 units and budgeted purchases cost of $3950. The production budget indicates a total of 12100 units to be produced. Standard direct labor hours per unit is 0.40 and the standard average wage rate is $14. What is budgeted direct labor cost?
Step by step
Solved in 3 steps
