Question

For July, White Corporation has budgeted production of 6,000 units. Each unit requires 0.10 direct labor-hours at a cost of $8.50 per direct labor-hour. How much will White Corporation budget for labor in July?
a.$51,000
b.$5,160
c.$600
d.$5,100

Answer 1

Answer:

d) $5100

Explanation:

Simply calculate per unit labor cost.

This can be done as follows

Per unit labor cost = hours used by unit * per hour rate

So,     Cost = 0.1 * 8.50 =  $0.85/ labor cost per unit produced.

Now multiply per unit cost with total units budgeted

Total Labor budget = 6000 * 0.85  =  $5,100

Hope that helps.