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XYZ Company is working on its direct labor budget for the next quarter (January, February and March). Each unit of product requires 0.4 hours (24 minutes) of direct labor. The direct labor normal rate is $13 per direct labor-hour. The company's direct labor work force consists of permanent employees who are guaranteed to be paid for at least 1,800 hours of work each month. If the number of required direct labor hours is less than this number, the workers are paid for 1,800 hours any way. Any hours worked in excess of 1,800 hours in a month are paid at the rate of 1.5 times the normal hourly rate for direct labor. The production budget calls for producing 5,000 units in January, 4,000 units in February, and 6,000 units in March. What would be the budgeted total direct labor cost for the quarter? Select one: O a. None of the given answers O b. $85,800 O c. $92,400 O d. $79,200 e. $78,000

XYZ Company is working on its direct labor budget for the next quarter (January, February and March). Each unit of product requires 0.4 hours (24 minutes) of direct labor. The direct labor normal rate is $13 per direct labor-hour. The company's direct labor work force consists of permanent employees who are guaranteed to be paid for at least 1,800 hours of work each month. If the number of required direct labor hours is less than this number, the workers are paid for 1,800 hours any way. Any hours worked in excess of 1,800 hours in a month are paid at the rate of 1.5 times the normal hourly rate for direct labor. The production budget calls for producing 5,000 units in January, 4,000 units in February, and 6,000 units in March. What would be the budgeted total direct labor cost for the quarter? Select one: O a. None of the given answers O b. $85,800 O c. $92,400 O d. $79,200 e. $78,000

Cornerstones of Cost Management (Cornerstones Series)
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter18: Pricing And Profitability Analysis
Section: Chapter Questions
Problem 20E: Eastman, Inc., manufactures and sells three products: R, S, and T. In January, Eastman, Inc.,...
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XYZ Company is working on its direct labor budget for the next quarter (January, February and March). Each unit of product requires 0.4 hours (24 minutes) of direct labor. The direct labor normal rate is $13 per direct labor-hour. The company's direct labor work force consists of permanent employees who are guaranteed to be paid for at least 1,800 hours of work each month. If the number of required direct labor hours is less than this number, the workers are paid for 1,800 hours any way. Any hours worked in excess of 1,800 hours in a month are paid at the rate of 1.5 times the normal hourly rate for direct labor. The production budget calls for producing 5,000 units in January, 4,000 units in February, and 6,000 units in March. What would be the budgeted total direct labor cost for the quarter? Select one: O a. None of the given answers O b. $85,800 O c. $92,400 O d. $79,200 O e. $78,000
Transcribed Image Text:XYZ Company is working on its direct labor budget for the next quarter (January, February and March). Each unit of product requires 0.4 hours (24 minutes) of direct labor. The direct labor normal rate is $13 per direct labor-hour. The company's direct labor work force consists of permanent employees who are guaranteed to be paid for at least 1,800 hours of work each month. If the number of required direct labor hours is less than this number, the workers are paid for 1,800 hours any way. Any hours worked in excess of 1,800 hours in a month are paid at the rate of 1.5 times the normal hourly rate for direct labor. The production budget calls for producing 5,000 units in January, 4,000 units in February, and 6,000 units in March. What would be the budgeted total direct labor cost for the quarter? Select one: O a. None of the given answers O b. $85,800 O c. $92,400 O d. $79,200 O e. $78,000
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