Blue Company produces Trivets.Based on its master budget,the company should produce 1,000 Trivets each month,working 2,500 direct labor hours.During May,only 900 Trivets were produced.The company worked 2,400 direct labor hours.The standard hours allowed for May production would be:
A)2,500 hours.
B)2,400 hours.
C)2,250 hours.
D)1,800 hours.

Question

Quizplus · Accepted Answer

The standard hours allowed are based on the budgeted production level of 1,000 Trivets per month, which is equivalent to 2,500 direct labor hours. However, since only 900 Trivets were produced in May, the standard hours allowed should be adjusted proportionally. Therefore, the standard hours allowed for May production would be 2,250 hours (900/1,000 * 2,500).

Blue Company Produces Trivets