Question

The Yost Company makes and sells a single product, Product A. Each unit of Product A...

The Yost Company makes and sells a single product, Product A. Each unit of Product A requires 1.2 hours of labor at a labor rate of 8.40 per hour. Yost Company needs to prepare a Direct Labor Budget for the second quarter.

1.  If the budgeted direct labor cost for May is $161,280, then the budgeted production of Product A for May would be:

A. 16,000 units

B. 19,200 units

C. 23,040  units

D. 16,800 units

2.  The budgeted direct labor cost per unit of Product A would be:

A. $8.40

B. $7.00

C. $10.08

D. $9.60

Business   Accounting   
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Homework Answers

Answer #1

1.

Budgeted direct labour cost = $ 161280

Direct labour rate = 8.4

Total hours consumed for budgeted production =

Budgeted direct labour cost /Direct labor rate

161280/8.4 = 19200

Budgeted units of production in the month of may =

Total hours consumed / per unit hours required

= 19200/1.2= 16000 units.

Answer is A. 16000 units.

2.

Budgeted direct labour cost of per unit of output =

Budget direct labour cost/ number of budgeted units produced

= 161280/16000=10.08

Answer is C. $ 10.08

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