Rad Co provides the ollowing sales forecast and production budget for the next f

Question

Rad Co provides the ollowing sales forecast and production budget for the next four months 690 TO 720 790 Sales (units) Budgeted production (units) 630 60 T30 730 The company plans for finished goods Inventary of 310 units at the and of June In adsition, each finished unit requaires ive pounds of raw 630 pounds. Each fnished unitequires 0 30 hours of direct labor at the rate of $18 per hour The budgets variable ovehead at the rate of $22 per direct labor hour and budgets fxed overhead of $9,900 per 1. Prepare a drect labor budget Direct Lebor Budget For Apeil, May, and June Budgeted otal labor hours needed 2. Prepare a factory overhead budget

Explanation / Answer

Direct labor budget April May june Budgeted production(unit) 630 760 730 direct labor hours per unit 0.3 0.3 0.3 total labor hours needed 189 228 219 rate per hour 18 18 18 labor cost 3402 4104 3942 Factory overhead budget April May june total labor hours needed 189 228 219 variable overhead per hour 22 22 22 budgeted variable overhead 4158 5016 4818 budgeted fixed overhead 9,900 9,900 9,900 total factory overhead 14058 14916 14718

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