Smith Industries manufactures three models of a product in a single plant with two departments: Cutting and Assembly. The company has estimated costs for each of the three product models, the

Zip, the Imperial, and the Zoom models.

View the direct labor hour information.

View the unit production information.

Requirement

Prepare a direct labor budget for the upcoming year that shows the budgeted direct labor costs for each department and for the company as a whole.

Prepare the direct labor budget for the Cutting Department, then the Assembly Department, and finally the company as a whole.

Direct labor hour information

Smith Industries

Direct Labor Budget

For the Upcoming Year

Cutting Department

Units to be produced

Multiply by: Direct labor hours per unit

Total cutting hours required

Multiply by: Direct labor cost per hour

Budgeted direct labor cost

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Unit production information