The Direct Labor Budget - Part 4 A B C D E G H 1234567 April May June Quarter Units of production 26,000 46,000 29,000 101,000 Direct labor time per unit Labor hours required 0.05 0.05 0.05 0.05 1,300 2,300 1,450 5,050 Hourly wage rate $ 10 $ 10 $ 10 $ 10 Total direct labor costs $ 13,000 $ 23,000 $ 14,500 $ 50,500 8 CMcGraw-Hill Education. All rights reserved. Authorized only for instructor use in the classroom. No reproduction further distribution permitted without the prior written consent of McGraw-Hill Education. Quick Check 5 What would be the total direct labor cost for the quarter if the company pays time and one-half ($10 x 1.5 $15) for all hours worked by employees over 2,000 per month. a. $51,700 b. $52,000 c. $53,250 d. $57,000 8-52

The Direct Labor Budget - Part 4 A B C D E G H 1234567 April May June Quarter Units of production 26,000 46,000 29,000 101,000 Direct labor time per unit Labor hours required 0.05 0.05 0.05 0.05 1,300 2,300 1,450 5,050 Hourly wage rate $ 10 $ 10 $ 10 $ 10 Total direct labor costs $ 13,000 $ 23,000 $ 14,500 $ 50,500 8 CMcGraw-Hill Education. All rights reserved. Authorized only for instructor use in the classroom. No reproduction further distribution permitted without the prior written consent of McGraw-Hill Education. Quick Check 5 What would be the total direct labor cost for the quarter if the company pays time and one-half ($10 x 1.5 $15) for all hours worked by employees over 2,000 per month. a. $51,700 b. $52,000 c. $53,250 d. $57,000 8-52

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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EXERCISES Exercise 1 Jenner Company developed its annual manufacturing overhead budget for its master budget for 2008 as follows: Expected annual operating capacity Variable overhead costs 120,000 Direct Labor Hours Indirect labon Indirect materials $420,000 90,000 30,000 _540,000 Factory supplies Total variable Fixed overhead costs Depreciation Supervision Property taxes Total fixed 180,000 120,000 96,000 396,000 $936,000 Total costs The relevant range for monthly activity is expected to be between 8,000 and 12,000 direct labor hours . Instructions Prepare a flexible budget for a monthly activity level of 8,000 and 9,000 direct labor hours. Exercise 2 Fagan Company uses a flexible budget for manufacturing overhead based on machine hours. Variable manufacturing overhead costs per machine hour are as follows: Indirect labor $5.00 Indirect materials Maintenance Utilities 2.50 50 30 Fixed overhead costs per month are: Supervision Insurance $600 200 Property taxes Depreciation 300 900 The…
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EXERCISE 8-15 Direct Labor and Manufacturing Overhead Budgets [ LO8-5, Q LO8-6] The Production Department of Hruska Corporation has submitted the following forecast of units to be produced by quarter for the upcoming fiscal year: 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Units to be produced 12,000 10,000 13,000 14,000 Each unit regquires 0.2 direct labor-hours and direct laborers are paid $12.00 per hour. In addition, the variable manufacturing overhead rate is $1.75 per direct labor-hour. The fixed manufacturing overhead is $86,000 per quarter. The only noncash element of manufacturing overhead is depreciation, which is $23,000 per quarter. Required: 1. Prepare the company's direct labor budget for the upcoming fiscal year, assuming that the direct labor workforce is adjusted each quarter to match the number of hours required to produce the forecasted number of units produced.
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