Pasadena Candle Inc. budgeted production of 36,000 candles for January. Each candle requires molding. Assume that five minutes are required to mold each candle. If molding labor costs $14.25 per hour, determine the direct labor cost budget for January. Round total direct labor cost to the nearest dollar, if required. Pasadena Candle Inc. Direct Labor Cost Budget For the Month Ending January 31 Hours required for assembly: Candles min. Convert minutes to hours min. Molding hours hrs. Hourly rate Total direct labor cost

Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter8: Budgeting
Section: Chapter Questions
Problem 4BE: Pasadena Candle Inc. budgeted production of 785,000 candles for January. Each candle requires...
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May
June
July
Units of production
55,000
50,000
45,000
Total
Supporting calculations:
Units of production
55,000
50,000
45,000
Hours per unit
Total hours of production
Wages per hour
Total wages
Total hours of production
Utility costs per hour
Total utilities
b. Compare the flexible budget with the actual expenditures for the first three months.
May
June
July
Total flexible budget
Actual cost
Excess of actual cost over budget
What does this comparison suggest?
%24
%24
%24
Transcribed Image Text:May June July Units of production 55,000 50,000 45,000 Total Supporting calculations: Units of production 55,000 50,000 45,000 Hours per unit Total hours of production Wages per hour Total wages Total hours of production Utility costs per hour Total utilities b. Compare the flexible budget with the actual expenditures for the first three months. May June July Total flexible budget Actual cost Excess of actual cost over budget What does this comparison suggest? %24 %24 %24
Pasadena Candle Inc. budgeted production of 36,000 candles for January. Each candle requires molding. Assume that five minutes are required to mold each candle. If
molding labor costs $14.25 per hour, determine the direct labor cost budget for January.
Round total direct labor cost to the nearest dollar, if required.
Pasadena Candle Inc.
Direct Labor Cost Budget
For the Month Ending January 31
Hours required for assembly:
Candles
min.
Convert minutes to hours
min.
Molding hours
hrs.
Hourly rate
x $
Total direct labor cost
Transcribed Image Text:Pasadena Candle Inc. budgeted production of 36,000 candles for January. Each candle requires molding. Assume that five minutes are required to mold each candle. If molding labor costs $14.25 per hour, determine the direct labor cost budget for January. Round total direct labor cost to the nearest dollar, if required. Pasadena Candle Inc. Direct Labor Cost Budget For the Month Ending January 31 Hours required for assembly: Candles min. Convert minutes to hours min. Molding hours hrs. Hourly rate x $ Total direct labor cost
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