Question 9 of 34 3 points Save a Direct Labor Budget for Jun

Question 9 of 34 3 points Save a Direct Labor Budget for June. The company plans to sell 40,000 units of Product WZ in June. The finished product called Product w2. Each unit of Product wZ requires S hours of direct labor at the rate of LBC Corpor hour. Management would like you to prepare ation makes and sells on June 1 and June 30 are budgeted to be 200 and 100 units, respectively. Budgeted direct labor costs for June would be b)$1,974,175 O $1,995,000 $564,050 9 of 34

Solution

Ans: C

Explanation:

To meet the requirements of the budgeted unit sales and the budgeted finished inventory, the company needs to produce [ (40000 - 200) + 100 ] units = 39900 units.

Budgeted direct labor costs = [ 39900 x (5 x $10.00) ] = $1995000