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Pulham Company is preparing its direct labor budget for 2016 from the following production budget based...

Pulham Company is preparing its direct labor budge

Pulham Company is preparing its direct labor budget for 2016 from the following production budget based on a calendar year: 

 Each unit requires 2 hours of direct labor. The union contract provides for a 10% increase in wage rate to $11 per hour on October 1. 
 Prepare a direct labor budget for 2016. 

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Expert Solution

Pulham Company
All Amounts in $
Direct Labor Budget
For The Year Ended December 31, 2016
Quarter Quarter Quarter Quarter Total
1 2 3 4
No. of units produced 60000 30000 45000 75000 210000
No.of hours required per unit 2 2 2 2 2
Total Hours worked 120000 60000 90000 150000 420000
Rate per labor hour 10 10 10 11
Total Direct Labor Cost 1200000 600000 900000 1650000 4350000

ekkarill92 answered 3 years ago
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