Question

Vaughn Manufacturing is planning to sell 600 buckets and produce 980 buckets during March. Each bucket requires 500 grams of plastic and one-half hour of direct labor. Plastic costs $10 per 500 grams and employees of the company are paid $17 per hour. Manufacturing overhead is applied at a rate of 110% of direct labor costs. Vaughn has 500 kilos of plastic in beginning inventory and wants to have 600 kilos in ending inventory. How much is the total amount of budgeted direct labor for March

Answer 1

Answer:

Labor Cost $ 8,330

Explanation:

-                   March

Units               980

Hours per Unit    0.5

Labor Hour        490

Rate                $ 17

Labor Cost $ 8,330

First, we look for the units to be produced.

Then, we multiply by the amount it takes to do a single unit, in this case, the one-half hour per bucket.

Now, we have the total labor hours

Last step, we multiply by the laobr rate to get the labor cost for the month of March