27th Edition
WARREN + 5 others
ISBN: 9781337272094




27th Edition
WARREN + 5 others
ISBN: 9781337272094
Textbook Problem

Direct labor cost budget

Daybook Inc. budgeted production of 403,500 personal journals in 20Y6. Each journal requires assembly. Assume that eight minutes are required to assemble each journal. If assembly labor costs $13.00 per hour, determine the direct labor cost budget for 20Y6.

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 Calculate: The direct labor cost budget for 20Y6.


Calculate the direct labor cost budget for 20Y6.

D Incorporation

Direct Labor Cost Budget

For the year ending December 31, 20Y6

Particulars Units
Hours required for assembly:
Personal journals (in minutes) (A) 3,228,000(1)
Convert minutes to hours (B) 60 minutes
Assembly Hours [(C) = (A) / (B)] 53,800
Hourly rate (D) $13
Total Direct Labor Cost [(C) × (D)] $699,400

Table (1)

Working Note:

Calculate the personal journals...

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