Ace Racket Company manufactures two types of tennis rackets, the Junior and Pro Striker models. The production budget for July for the two rackets is as follows:
Junior | Pro Striker | |
Production budget | 7,500 units | 22,700 units |
Both rackets are produced in two departments, Forming and Assembly. The direct labor hours required for each racket are estimated as follows:
Forming Department | Assembly Department | |
Junior | 0.20 hour per unit | 0.50 hour per unit |
Pro Striker | 0.35 hour per unit | 0.75 hour per unit |
The direct labor rate for each department is as follows:
Forming Department | $16.00 per hour |
Assembly Department | $9.00 per hour |
Prepare the direct labor cost budget for July.
Ace Racket Company | ||
Direct Labor Cost Budget | ||
For the Month Ending July 31 | ||
Forming Department | Assembly Department | |
Hours required for production: | ||
Junior | fill in the blank 1 | fill in the blank 2 |
Pro Striker | fill in the blank 3 | fill in the blank 4 |
Total | fill in the blank 5 | fill in the blank 6 |
Hourly rate | x$fill in the blank 7 | x$fill in the blank 8 |
Total direct labor cost | $fill in the blank 9 | $fill in the blank 10 |
Ace Racket Company |
||
Direct Labor Cost Budget |
||
For the Month Ending July 31 |
||
Forming Department |
Assembly Department |
|
Hours required for production: |
||
Junior |
7,500 X 0.20 = 1,500 |
7,500 X 0.50 = 3,750 |
Pro Striker |
22,700 X 0.35 = 7,945 |
22,700 X 0.75 = 17,025 |
Total |
9,445 |
20,775 |
Hourly rate |
x $16 |
x $9 |
Total direct labor cost |
$151,120 |
$186,975 |
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