The production budget: It is used to calculate the number of units of products that needs to be produced, and it is calculated from the sales forecast and the amount of finished goods inventory. Direct labor budget is the budget which is used to calculate the number of labor hours that is required to produce the units. To prepare : The direct labor budget for May and June.

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Chapter 8, Problem 7E

To determine

Concept introduction:

The production budget: It is used to calculate the number of units of products that needs to be produced, and it is calculated from the sales forecast and the amount of finished goods inventory.

Direct labor budget is the budget which is used to calculate the number of labor hours that is required to produce the units.

To prepare :

The direct labor budget for May and June.

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