Question

projects variable labor costs of $21,500 in March when 8,600 units are produced. If production is expected to drop to 8,000 units in April, what is the expected labor cost in April

Answer 1

Total direct labor cost=$20,000

Step-by-step explanation:

First, we need to calculate the direct labor cost per unit:

Direct labor cost per unit= total cost / number of units

Direct labor cost per unit= 21,500 / 8,600

Direct labor cost per unit= $2.5

Now, the total cost for 8,000 units:

Total direct labor cost= 2.5*8,000

Total direct labor cost=$20,000