Theresa Corporation, Which Manufactures Baskets, Is Developing Direct Labor Standards

Multiple Choice

Theresa Corporation, which manufactures baskets, is developing direct labor standards. The basic direct labor rate is $21.00 per hour. Payroll taxes are 9% of the basic direct labor rate, while fringe benefits such as vacation and health care insurance, are $4.00 per hour. What is the standard rate per direct labor hour?

A) $26.89
B) $21.00
C) $22.89
D) $25.00