Production and Direct Labor Cost Budgets Two-Leg Company manufactures slacks and jeans under a variety of brand names, such as Dockers and 501 Jeans Slacks and jeans are assembled by a variety of different sewing operations. Assume that the sales budget for Dockers and 501 Jeans shows estimated sales of 33,960 and 71,500 pairs, respectively, for May. The finished goods inventory is assumed as follows: Dockers 501 Jeans 1,520 2,020 May 1 estimated inventory May 31 desired inventory 560 2,520 Assume the following direct labor data per 10 pairs of Dockers and 501 Jeans for four different sewing operations: Direct Labor per 10 Pairs Dockers 501 Jeans Inseam 18 minutes 12 minutes Outerseam 22 15 Pockets 7 9 Zipper 10 6 Total 57 minutes 42 minutes a. Prepare a production budget for May. Prepare the budget in two columns: Dockers and 501 Jeans. For those boxes in which you must enter subtracted or negative numbers use a minus sign. TWO-Leg Company Production Budget For Month Ending May 31 (assumed data) Dockers 501 Jeans Expected units to be sold 33,960 71,500 May 31 desired inventory 2,520 560 Total units available 34.520 74,020 May 1 estimated inventory -1,520 -2,020 Total units to be produced 33,04) 72,000 Feedback Check My Work b. Prepare the May direct labor cost budget for the four sewing operations, assuming a $12 wage per hour for the inseam and outerseam sewing operations and a $19 wage per hour for the pocket and zipper sewing operations. Prepare the direct labor cost budget in four columns: inseam, outerseam, pockets, and zipper. Two-Leg Company For Month Ending May 31 (assumed data) Dockers Expected units to be sold 33,960 501 Jeans 71,500 May 31 desired inventory 560 2,520 31,520 74,020 Total units available May 1 estimated inventory -1,520 -2,020 Total units to be produced 33,000 72,000 Feedback Check My Work b. Prepare the May direct labor cost budget for the four sewing operations, assuming a $12 wage per hour for the inseam and outerseam sewing operations and a $19 wage per hour for the pocket and zipper sewing operations. Prepare the direct labor cost budget in four columns: inseam, outerseam, pockets, and zipper. Two-Leg Company Direct Labor Cost Budget For Month Ending May 31 (assumed data) Inseam Outerseam Pockets Zipper Total Dockers 59,400 72,600 23,100 33,000 501 Jeans 86,400 108,000 64.800 43,200 Total minutes 145.800 180,600 | 87.900 76,200 Total direct labor hours Direct labor rate XS 12 XS 12 x 5 19 XS 19 Total direct labor cost Feedback Check My Work Feedback Check My Work
