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Pewabic plans to sell 900 boxes of art tile in April, and estimates they'll craft 870 boxes during the month. Each box of tile requires 44 pounds of clay and a quarter hour of direct labor. Clay costs $0.40 per pound and pottery artisans are paid $12.00 per hour. Manufacturing overhead is applied at a rate of 110% of direct labor costs. Pewabic has 3,900 pounds of clay in beginning inventory on April 1 and wants to have 4,500 pounds in ending inventory on April 30. What total amount should Pewabic budget for direct labor for the of April

Answer :

KOLAWOLE845GO

Answer:

Direct labour cost budget= $2,610

Explanation:

The direct labor cost budget is a function of the production product budget. The quantity of the product budgeted to be produced would determine the labor cost budget.

Direct labour budget = Production budget × standard hours × standard labour rate per hour

Standard hour = a quarter direct labour = 1/4 hour

Direct labour budget = 870 × 0.1× $12= $2610

Direct labour cost budget= $2,610

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