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7 May, 11:01

Synergy Inc manufactured 6,000 units during the month of March. They incurred direct materials cost of $120,000 and manufacturing overhead costs of $48,000. If their per-unit prime cost was $31.20 per unit, how much direct labor cost did it incur during March? a. $20,000b. $35,000c. $90,000d. $67,200

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  1. 7 May, 14:01
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    =$67,200.00

    Explanation:

    Prime costs are the direct expenses of material and labor in the production process. In other words, prime cost is direct labor plus material cost. Indirect manufacturing overhead costs are not considered part of prime costs.

    In this case:

    Direct material cost: $120,000.00

    manufactured items: 6000 units

    prime cost per unit: $31.20

    Direct labor:?

    Prime cost per unit = Directs cost per unit + Direct labor per unit

    =$31.20 = ($120,000+DL) 6000 units

    =$31.20=$120,000 / 6000+DL

    =$31.20=20+DL

    DL=$31.20-20=$11.20

    Direct labor per unit=$11.20

    Total direct labor = Direct labor per unit x units produced

    =$11.20 x 6000

    =$67,200.00
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Home » Business » Synergy Inc manufactured 6,000 units during the month of March. They incurred direct materials cost of $120,000 and manufacturing overhead costs of $48,000. If their per-unit prime cost was $31.
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