Depasquale Corporation is working on its direct labor budget for the next two mo
ID: 2594419 • Letter: D
Question
Depasquale Corporation is working on its direct labor budget for the next two months. Each unit of output requires 0.61 direct labor-hours. The direct labor rate is $9.00 per direct labor-hour. The production budget calls for producing 7,000 units in May and 7,400 units in June. If the direct labor work force is fully adjusted to the total direct labor-hours needed each month, what would be the total combined direct labor cost for the two months?
Multiple Choice
$38,430.00
$40,626.00
$39,528.00
$79,056.00
Explanation / Answer
Total combined direct labor cost for the two months = (7,000 units in may * 0.61 direct labour hours per unit * 9 per direct labour hour) + (7,400 units in june * 0.61 direct labour hours per unit * 9 per direct labour hour)
= 38,430 + 40,626
= 79,056
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