To Calculate Budgeted Direct Labor Costs,multiply the Number of Units

question 126

True/False

To calculate budgeted direct labor costs,multiply the number of units to be produced by the number of projected direct labor hours.Next,multiply that total by the average direct cost per hour.

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Definitions:

Budgeted Activity

The level of operation or volume of work planned for a period, used in budgeting and planning processes.

Fixed Overhead

Costs that do not vary with the level of production or sales, such as salaries and rent.

Direct Labor-Hours

A measure of the work done by labor force, specifically calculated based on the hours worked in producing goods.

Depreciation

The systematic allocation of the depreciable amount of an asset over its useful life.