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The amount of direct-labor hours that should be used to produce one unit of finished goods is the hours per unit

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Solution

The amount of direct-labor hours that should be used to produce one unit of finished goods is referred to as the "hours per unit". This is a measure of labor efficiency and productivity in the production process.

Here are the steps to calculate it:

  1. Identify the total amount of direct labor hours: This is the total amount of time that workers spend on the production process. This information can usually be obtained from payroll data or production records.

  2. Identify the total number of units produced: This is the total amount of finished goods that are produced during the same period. This information can usually be obtained from production records or sales data.

  3. Divide the total amount of direct labor hours by the total number of units produced: This will give you the amount of direct-labor hours that should be used to produce one unit of finished goods, or the "hours per unit".

For example, if a company uses 1000 direct labor hours to produce 500 units of a product, the hours per unit would be 1000 / 500 = 2 hours per unit. This means that, on average, it should take 2 hours of direct labor to produce one unit of this product.

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