E9-22A (similar to) Question Help Austen Industries manufactures three models of

Question

E9-22A (similar to) Question Help Austen Industries manufactures three models of a product in a single plant with two departments: Cutting and Assembly. The company has estimated costs for each of the three product models, the Rocket, the Regal, and the Imperial models. (Click the con to vew the direct labor hour mo mation.) (Click the loon to view the unit production information Requirement Data Table Prepare a direct labor budget for the upcoming year that shows the budgeted direct labor costs for each department and for the company as a whole The company is currently analyzing direct labor hour requirements for the upcoming year Prepare the direct labor budget for the Cutting Department, then the Assembly Department, and finally the company as a whole. Austen Industries Direct Labor Budget For the Upcoming Year Rocket Cutting Assembly Estimated hours per unit: Rocket Regal Imperial 2.2 2.9 2.7 .12 14 Rega Imperial Total Cutting Department Units to be produced Multiply by: Direct labor hours per unit Total cutting hours required Multiply by: Direct labor cost per hour Bucgeted direct labor cost 1.9 Direct labor hour rate Data Table PrintDone Budgeted unit production for each of the products is as follows: Number of units to be produced Product model: Rocket Regal Imperial 550 710 870 Print Done

Explanation / Answer

PREPARE DIRECT LABOUR COST BUDGET :

Rocket Regal Imperial Total Cutting department Units to be produced 550 710 870 Multiply by : Direct labour hours per unit 1.8 1.6 1.9 Total cutting hours required 990 1136 1653 Multiply by direct labor cost per hour 12 12 12 Budgeted direct labour cost 11880 13632 19836 45348 Assembly Department Units to be produced 550 710 870 Multiply by : Direct labour hours per unit 2.2 2.9 2.7 Total assembly hours required 1210 2059 2349 Multiply by direct labor cost per hour 14 14 14 Budgeted direct labour cost 16940 28826 32886 78652 Total direct labour cost 28820 42458 52722 124000

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