Question

Rodriguez, Inc., is preparing its direct labor budget for 2020 from the following production budget based on a calendar year. Quarter Quarter Units 20,340 25,110 Units 35,440 30,500 4 Each unit requires 1.70 hours of direct labor. Prepare a direct labor budget for 2020. Wage rates are expected to be $15 for the first 2 quarters and $17 for quarters 3 and 4. (Round Direct labor time per unit answers to 2 decimal places, e.g. 52.50.) RODRIQUEZ, INC. Direct Labor Budget Quarter 2

Answer 1

	Quarter
	1	2	3	4	Year
Units	20,340	25,110	35,440	30,500
Direct Labor time per unit	1.70	1.70	1.70	1.70
Total Direct labor hours required	34,578	42,687	60,248	51,850
Wage rate	15	15	17	17
Direct Labor Cost	518,670	640,305	1,024,216	881,450	3,064,641

Note:

Total Direct labor hours required = Units * Direct Labor required per unit

Direct Labor Cost = Total Direct labor hours required* Wage rate