Question

The production manager of Rordan Corporation has submitted the following quarterly production forecast for the upcoming fiscal year 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 9,400 Units to be produced 7,000 7,700 10,000 Each unit requires 0.25 direct labor-hours, and direct laborers are paid $10.00 per hour. Required: 1. Prepare the company's direct labor budget for the upcoming fiscal year. Assume that the direct labor workforce is adjusted each quarter to match the number of hours required to produce the forecasted number of units produced. 2. Prepare the company's direct labor budget for the upcoming fiscal year, assuming that the direct labor workforce is not adjusted each quarter. Instead, assume that the company's direct labor workforce consists of permanent employees who are guaranteed to be paid for at least 2,200 hours of work each quarter. If the number of required direct labor-hours is less than this number, the workers are paid for 2,200 hours anyway. Any hours worked in excess of 2,200 hours in a quarter are paid at the rate of 1.5 times the normal hourly rate for direct labor Complete this question by entering your answers in the tabs below. Required 2 Required 1 Prepare the company's direct labor budget for the upcoming fiscal year. Assume that the direct labor workforce is adjusted each quarter to match the number of hours required to produce the forecasted number of units produced. (Round "Direct labor time per unit (hours)" answers to 2 decimal places.) Rordan Corporation Direct Labor Budget

Answer 1

1. Complete the company's direct labor budget for the upcoming fiscal year, assuming that the direct labor workforce is adjusted each quarter to match the number of hours required to produce the forecasted number of units produced. (Round "Direct labor time per unit (hours)" answers to 2 decimal places.)
Rordan Corporation
Direct Labor Budget
	1st Quarter	2nd Quarter	3rd Quarter	4th Quarter
Required production in units	9,400.00	7,000.00	7,700.00	10,000.00
Direct labor time in unit (hours)	0.25	0.25	0.25	0.25
Total direct labor-hours needed	2,350.00	1,750.00	1,925.00	2,500.00
Direct labor cost per hour	$10	$10	$10	$10
Total direct labor cost	$ 23,500.00	$ 17,500.00	$ 19,250.00	$ 25,000.00
2. Complete the company's direct labor budget for the upcoming fiscal year, assuming that the direct labor workforce is not adjusted each quarter. Instead, assume that the company's direct labor workforce consists of permanent employees who are guaranteed to be paid for at least 2200 hours of work each quarter. If the number of required direct labor-hours is less than this number, the workers are paid for 2200 hours anyway. Any hours worked in excess of 2200 hours in a quarter are paid at the rate of 1.5 times the normal hourly rate for direct labor. (Input all amounts as positive values.)
Rordan Corporation
Direct Labor Budget
	1st Quarter	2nd Quarter	3rd Quarter	4th Quarter
Total direct labor-hours needed	9,400.00	7,000.00	7,700.00	10,000.00
Regular hours paid	0.25	0.25	0.25	0.25
Total direct labor-hours needed	2,350.00	1,750.00	1,925.00	2,500.00
Regular hours paid	2,200.00	2,200.00	2,200.00	2,200.00
Overtime hours paid	150.00			300.00
Wages for regular hours	$ 22,000.00	$ 22,000.00	$ 22,000.00	$ 22,000.00
Overtime wages	$   2,250.00	$              -	$              -	$   4,500.00
Total direct labor cost	$ 24,250.00	$ 22,000.00	$ 22,000.00	$ 26,500.00

1 The production manager of Rordan Corporation has submitted the following forecast of units to be produce 1st Quarter 9400 2nd Quarter 7000 3rd Quarter 7700 4th Quarter 10000 3 Units to be produced 4 Each unit requires 0.25 direct labor-hours, and direct laborers are paid $10.00 per hour. 5 Required: 6 1. Complete the company's direct labor budget for the upcoming fiscal year, assuming that the direct labor 7 Rordan Corporation 8 Direct Labor Budget 2nd Quarter 4th Quarter =C3 =E3 10 Required production in units 11 Direct labor time in unit (hours) 12 Total direct labor-hours needed 13 Direct labor cost per hour 14 Total direct labor cost 1st Quarter =B3 0.25 =B10 B11 3rd Quarter =D3 0.25 =D10*D11 0.25 =C10*c11 0.25 =E10 E11 10 10 10 10 =B12 B13 =C12.013 =D12*D13 =E12E13 16 2. Complete the company's direct labor budget for the upcoming fiscal year, assuming that the direct labor 17 Rordan Corporation 18 Direct Labor Budget 19 1st Quarter =B10 0.25 =B20 B21 2200 =B22-B23 =B23 10 =B13 1.5*B24 =B25+B26 2nd Quarter =C10 0.25 =C20*C21 2200 3rd Quarter =D10 0.25 =D20D21 2200 20 Total direct labor-hours needed 21 Regular hours paid 22 Total direct labor-hours needed 23 Regular hours paid 24 Overtime hours paid 25 Wages for regular hours 26 Overtime wages 27 Total direct labor cost 4th Quarter =E10 0.25 =E20*E21 2200 =E22-E23 =E23 10 =E13*1.5 E24 =E25+E26 =C2310 =C13 1.5°C24 =C25+C26 =D23 10 =D13 1.5 D24 =D25+D26 28