Each unit requires 0.35 direct labor-hours, and direct laborers are paid $20 per

Question

Each unit requires 0.35 direct labor-hours, and direct laborers are paid $20 per hour.

1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Units to be produced 10,600 8,500 7,000 11,100 1. Complete the company's direct labor budget for the upcoming fiscal year, assuming that the direct labor workforce is adjusted each quarter to match the number of hours required to produce the forecasted number of units produced. (Round "Direct labor time per unit (hours)" answers to 2 decimal places.) Rordan Corporation Direct Labor Budget st Quarter 2nd Quarter 3rd Quarter 4th Quarter Year Required production in units Direct labor time per unit (hours) Total direct labor-hours needed Direct labor cost per hour Total direct labor cost 2. Complete the company's direct labor budget for the upcoming fiscal year, assuming that the direct labor workforce is not adjusted each quarter. Instead, assume that the company's direct labor workforce consists of permanent employees who are guaranteed to be paid for at least 3,000 hours of work each quarter. If the number of required direct labor-hours is less than this number, the workers are paid for 3,000 hours anyway. Any hours worked in excess of 3,000 hours in a quarter are paid at the rate of 1.5 times the normal hourly rate for direct labor. (Input all amounts as positive values.) Rordan Corporation Direct Labor Budget 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Year Total direct labor-hours needed Regular hours paid Overtime hours paid Wages for regular hours Overtime wages Total direct labor cost

Explanation / Answer

1 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Year Required production in units 10600 8500 7000 11100 37200 Direct labor time per unit (hours) 0.35 0.35 0.35 0.35 0.35 Total direct labor-hours needed 3710 2975 2450 3885 13020 Direct labor cost per hour 20 20 20 20 20 Total direct labor cost 74200 59500 49000 77700 260400 2 Total direct labor-hours needed 3710 2975 2450 3885 13020 Regular hours paid 3000 3000 3000 3000 12000 Overtime hours paid 710 0 0 885 1595 Wages for regular hours 60000 60000 60000 60000 240000 Overtime wages 21300 0 0 26550 47850 Total direct labor cost 81300 60000 60000 86550 287850

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