Webster Corporation is preparing a master budget for the first quarter of the year. The company budgets production of 2,680 units in January, 2,600 units in February and 2,740 units in March. Each unit requires 0.6 hours of direct labor. The direct labor rate is $12 per hour. Compute the budgeted direct labor cost for the first quarter budget.

Question

Quizplus · Accepted Answer

The budgeted direct labor cost for the first quarter is $57,744. This is calculated as follows:2,680 units x 0.6 hours per unit x $12 per hour = $19,392 in January2,600 units x 0.6 hours per unit x $12 per hour = $18,720 in February2,740 units x 0.6 hours per unit x $12 per hour = $19,632 in MarchTotal budgeted direct labor cost for the first quarter = $19,392 + $18,720 + $19,632 = $57,744

Webster Corporation Is Preparing a Master Budget for the First