Question

Exercise 23-21 Emeric and Ellie’s Painting Service estimates that it will paint 15 small homes, 10 medium homes, and 3 large homes during the month of June 2017. The company estimates its direct labor needs as 40 hours per small home, 76 hours for a medium home, and 134 hours for a large home. Its average cost for direct labor is $29 per hour. Prepare a direct labor budget for Emeric and Ellie’s Painting Service for June 2017.

Answer 1

 Total direct labor cost budget for June 2017   small home is $13,920 ,     medium home is $22,040 and large home is $11,658

Explanation:                            Total direct labor cost budget for June 2017

                                                        small home  medium home   large home

budgeted painting requirement               15                 10                      3

direct labor needs (in hours)                     40                76                    134

                                                             -----------------------------------------------------

Total direct labor hours                             480            760                   402

direct labor cost per hour                          $29            $29                   $29

                                                             -----------------------------------------------------Total direct labor cost budget for          $13,920      $22,040         $11,658

June 2017                                            -----------------------------------------------------

Total direct labor cost =

(Total direct labor hours×direct labor cost per hour )