# Direct labor cost budget MatchPoint Racket Company manufactures two types of tennis rackets, the Junior and Pro Striker models. The production budget for March for the two rackets is as follows: Junior Pro Striker Production budget 2,200 units 7,000 units Both rackets are produced in two departments, Forming and Assembly. The direct labor hours required for each racket are estimated as follows: Forming Department Assembly Department Junior 0.10 hour per unit 020 hour per unit Pro Striker 0.15 hour per unit 0.25 hour per unit The direct labor rate for each department is as follows: Forming Department $15.00 per hour Assembly Department SI4.00 per hour Prepare the direct labor cost budget for March. BuyFind ### Accounting 27th Edition WARREN + 5 others Publisher: Cengage Learning, ISBN: 9781337272094 BuyFind ### Accounting 27th Edition WARREN + 5 others Publisher: Cengage Learning, ISBN: 9781337272094 #### Solutions Chapter Section Chapter 22, Problem 22.12EX Textbook Problem ## Direct labor cost budgetMatchPoint Racket Company manufactures two types of tennis rackets, the Junior and Pro Striker models. The production budget for March for the two rackets is as follows: Junior Pro Striker Production budget 2,200 units 7,000 units Both rackets are produced in two departments, Forming and Assembly. The direct labor hours required for each racket are estimated as follows: Forming Department Assembly Department Junior 0.10 hour per unit 020 hour per unit Pro Striker 0.15 hour per unit 0.25 hour per unit The direct labor rate for each department is as follows: Forming Department$15.00 per hour Assembly Department SI4.00 per hour Prepare the direct labor cost budget for March.

Expert Solution
To determine

Budgeting is a process to prepare the financial statement by the manager to estimate the organization’s future actions. It is also helpful to satisfy the everyday activities.

To Prepare: The direct labor cost budget of Company M.

### Explanation of Solution

The following table shows the direct labor cost budget for forming department and assembly department.

 Company M Direct Labor Cost Budget For the Month Ending March 31 Particulars Forming Department Assembly Department Hours Required For Production: Junior 220 (1) 440 (2) Pro Striker 1,050 (3) 1,750 (4) Total Hours Required (A) 1,270 2,190 Hourly Rate (B) $15$14 Total Direct Labor Cost (A) × (B) $19,050$30,660

Table (1)

Working Notes:

Calculate the hours required for the production of junior in forming department.

Hours required for production=2,200×0.10hr=220hrs (1)

Calculate the hours required for the production of junior in assembly department

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