Smith Corporation makes and sells a single product called a Pod. Each Pod requires 1.4 direct labor-hours at $9.60 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.If the budgeted direct labor cost for April is $201,600, then the budgeted production of Pods for April would be:

Question

Quizplus · Accepted Answer

To find the budgeted production of Pods, divide the total direct labor cost by the cost per direct labor-hour and then by the hours required per Pod: $201,600 / $9.60 per hour / 1.4 hours per Pod = 15,000 units.

Smith Corporation Makes and Sells a Single Product Called a Pod