Smith Corporation makes and sells a single product called a Pod. Each Pod requires 2.7 direct labor-hours at $10.90 per direct labor-hour. The direct labor workforce is fully adjusted each month to the required workload. Smith Corporation is preparing a Direct Labor Budget for the second quarter of the year.In June the company has budgeted to produce 23,300 Pods. Budgeted direct labor costs incurred in June would be: (Round your intermediate calculations to 2 decimal places.)

Question

Quizplus · Accepted Answer

To calculate the budgeted direct labor costs for June, multiply the number of Pods (23,300) by the direct labor-hours required per Pod (2.7) to get the total direct labor-hours needed. Then, multiply the total direct labor-hours by the cost per direct labor-hour ($10.90). The calculation is 23,300 Pods * 2.7 hours/Pod * $10.90/hour = $685,719.

Smith Corporation Makes and Sells a Single Product Called a Pod