Question

MatchPoint Racket Company manufactures two types of tennis rackets, the Junior and Pro Striker models. The production budget for March for the two rackets is as follows:

	Junior	Pro Striker
Production budget	6,300 units	18,800 units

Both rackets are produced in two departments, Forming and Assembly. The direct labor hours required for each racket are estimated as follows:

	Forming Department	Assembly Department
Junior	0.25 hour per unit	0.5 hour per unit
Pro Striker	0.35 hour per unit	0.6 hour per unit

The direct labor rate for each department is as follows:

Forming Department	$16 per hour
Assembly Department	$9 per hour

Prepare the direct labor cost budget for March.

MatchPoint Racket Company
Direct Labor Cost Budget
For the Month Ending March 31
	Forming Department	Assembly Department
Hours required for production:
Junior
Pro Striker
Total hours required
Hourly rate	x$	x$
Total direct labor cost	$	$

Answer 1

Total Hours required for Junior
	Forming Department	Assembly Department
Production (a)	6300	6300
Hours required per unit (b)	0.25	0.5
Total Hours Required (a*b)	1575	3150
Total Hours required for Pro Sticker
	Forming Department	Assembly Department
Production (a)	18800	18800
Hours required per unit (b)	0.35	0.6
Total Hours Required (a*b)	6580	11280
Matchpoint Racket Company
Direct Labor Cost Budget
For the month ending March 31
	Forming Department	Assembly Department
Hours required for Production
Junior	1575	3150
Pro Sticker	6580	11280
Total Hours required	8155	14430
Hourly rate	$                                      16	$                                            9
Total Direct labor cost	$                           130,480	$                               129,870