Answer:
The preparation of the direct labor budget is presented below:
Explanation:
The preparation of the direct labor budget is presented below:
Direct labor cost budget
For the month of July 2016
Particulars Forming Department Assembly Department
Production 1,500 units 6,200 units
Hours required
Junior 240 360
Hours Required
Pro 1,240 1,860
Total Hours
Department wise (A) 1,480 2,220
Total Hourly rate (B) $18 $14
Total Direct
Labor Cost (A × B) $26,640 $31,080
The computation is shown below:
For Junior, it would be
Forming = 0.16 × 1,500 = 240
Assembly = 0.24 × 1,500 = 360
For Pro, it would be
Forming = 0.20 × 6,200 = 1,240
Assembly = 0.30 × 6,200 = 1,860
