Planning Manpower and Labor Costs. Virontrol, Inc. is a relatively new company in the environmental control industry and is experiencing tremendous growth in product demand. To meet customers' increasing demands, the man- agement is considering the addition of a nighttime operation production shift beginning October 1.
Production takes place in three departments: Assembly, Molding, and
Finishing. Standard time in the Molding Department is 10 minutes per unit
produced, while the Finishing Department averages 12Yz items per hour. Em- ployees in these two departments are paid $5 per hour. Two people are needed
in the Assembly Department, each with a monthly salary of $850, to serve the extra shift. One foreman for each 19 workers is needed in the Molding and Finishing Departments, and 5 cleanup employees are required. Foremen are paid
$1,200 per month, and each member of the cleanup crew is paid $3.50 per hour.
Under normal conditions, the company schedules 20 work days per month
with standard monthly production of 120,000 units.
Required: A monthly labor budget for the extra shift, showing the time required in each department, the labor cost for each department and service, unit labor cost, and the number of employees required.