Answer:
The direct labor costs for the period is $1,050
Explanation:
Here in this question, we are concerned with calculating the direct labor costs for the period.
To calculate this, we employ a mathematical approach.
Let the direct material cost for the period be $y.
Mathematically, direct labor cost = Prime costs - direct material cost
From the question, Prime costs = $15,500
Thus, the direct labor cost = $15,500 -$y
Mathematically also;
Conversion costs = Direct labor costs + Factory overheads
But from the question, we know that the factory overheads = 1.5 * direct material costs = 1.5 * y = 1.5y
Thus by adding the factory overheads to the direct labor cost and equating to the conversion factor, we have;
1.5y + 15500-y = 22,725
1.5y -y = 22,725 - 15500
0.5y = 7225
y = 7225/0.5
y = $14,450
Recall;
Direct labor costs = Prime costs - direct material costs
Direct labor cost = 15,500 - 14,450 = $1,050