Piper Corporation, which manufactures dog toys, is developing direct labor standards. The basic direct labor rate is $16.79 p

Question

4 years ago

12

Piper Corporation, which manufactures dog toys, is developing direct labor standards. The basic direct labor rate is $16.79 p

er hour. Payroll taxes are 15% of the basic direct labor rate, while fringe benefits such as vacation and health care insurance, are $6.41 per hour. What is the standard rate per direct labor hour?

Business

2 answers:

Leviafan [203] · Answer 1 · 2022-02-17T20:44:40+03:00

Answer:

direct labor hour 25.72

Explanation:

16.79 + 15% taxes + vacation and HI 6,41

16.79 + 16.79 x 15% + 6.41

16.79 + 2.5185 + 6.41 = 25.7185 = 25.72

<u>Notes:</u>

The assignment state the payroll taxes only apply to the basic direct labor rate, so we should assume the fringe benefit are tax-exempt

myrzilka [38] · Answer 2 · 2022-02-17T23:01:41+03:00

Is known :

Basic direct labor costs = $ 16.79 per hour

Payroll tax = 15%

Additional allowance = $ 6.41 per hour

Asked:

<em>The standard rate per hour of direct work? </em>

Settlement:

SRDw = work time x BDLc

SRDw = 1 x $ 14.29

SRDw = $ 14.29

So the standard direct hourly rate is $ 14.29

<u><em>Note</em></u> = The value of $ 14.29 is from the calculation of $ 16.79 - 15% (amount of basic direct labor tax)

<h2>Further explanation </h2>

Direct Labor Cost Budget

Direct Labor is human labor that works directly to process products. For example, for rattan chair manufacturers, it is cutters, chair gauges, chair assemblers, chair planers, and chair color craftsmen. The wages are called Direct Labor Costs.

Direct labor costs are estimates of the number of direct labor hours needed to produce certain products. How:

Calculate the average hours worked in a job based on the previous period's base price card
Run production operations under the expected normal conditions
Conducting investigations of motion and time
Making reasonable estimates