Theresa Corporation, Which Manufactures Baskets, Is Developing Direct Labor Standards

question 99

Multiple Choice

Theresa Corporation, which manufactures baskets, is developing direct labor standards. The basic direct labor rate is $21.00 per hour. Payroll taxes are 9% of the basic direct labor rate, while fringe benefits such as vacation and health care insurance, are $4.00 per hour. What is the standard rate per direct labor hour?

• A)$26.89
• B)$21.00
• C)$22.89
• D)$25.00

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Definitions:

Limited Liability Company

A business structure that combines the pass-through taxation of a partnership or sole proprietorship with the limited liability of a corporation.

Sole Proprietorship

A sole proprietorship is a type of unincorporated business owned and operated by one individual, with no distinction between the business and the owner for legal and tax purposes.

Partnership

A legal business relationship between two or more individuals who share management and profits or losses of the business.

Schedule E

A financial document utilized for declaring earnings and deficits from sources such as rental real estate, royalties, partnership entities, S corporations, estates, and trusts.