FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Morganton Company makes one product and it provided the following information to help prepare the
- The budgeted selling price per unit is $65. Budgeted unit sales for June, July, August, and September are 8,400, 15,000, 17,000, and 18,000 units, respectively. All sales are on credit.
- Thirty percent of credit sales are collected in the month of the sale and 70% in the following month.
- The ending finished goods inventory equals 30% of the following month’s unit sales.
- The ending raw materials inventory equals 20% of the following month’s raw materials production needs. Each unit of finished goods requires 5 pounds of raw materials. The raw materials cost $2.50 per pound.
- Thirty percent of raw materials purchases are paid for in the month of purchase and 70% in the following month.
- The direct labor wage rate is $12 per hour. Each unit of finished goods requires two direct labor-hours.
- The variable selling and administrative expense per unit sold is $1.60. The fixed selling and administrative expense per month is $65,000.
10. What is the total estimated direct labor cost for July?
Expert Solution
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Step 1
DITECT LABOUR COST BUDGET
Direct labour Cost Budget helps to estimates the total number Of Direct labour hour Required to produce the Expected Amount of Units
It also Help to Determine the Direct labour Cost required to produced the Estimated number Of Units.
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