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LFM Corporation: Budgeted direct labor costs for June

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LFM Corporation makes and sells a product called Product WZ. Each unit of Product WZ requires 3.5 hours of direct labor at the rate of $16.00 per direct labor hour. Management would like you to prepare a Direct Labor Budget for June.

The company plans to sell 31,000 units of Product WZ in June. The finished goods inventories on june 1 and June 30 are budgeted to be 100 and 600 units, respectively. Budgeted direct labor costs for June would be:

a) 1764000
b) 504000
c) 1708000
d) 1736000
e) none of the above

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Solution Summary

The expert examines budgeted direct labor costs for June. LFM Corporation is examined.

Solution Preview

Begnning Inventory = 100 units

Planned Sales = 31,000

Required Ending Inventory = 600 units

Total Production ...

Solution provided by:
Gaurav Agarwal, MS
Education
  • BE, Bangalore University, India
  • MS, University of Wisconsin-Madison
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