Classification of labour costs, Cost Accounting

Assignment Help:

Classification of Labour Costs

This can be classified into like:

a) Indirect or Direct cost

b) Variable or Fixed cost

c) Non controllable and controllable cost

a) Direct labour cost might be defined like the cost of remuneration for staff skills and efforts applied directly to a product or saleable service and that can be recognized separately in product costs.

Indirect labour cost may be defined like labour costs that are not charged directly to a product. The analysis of labour costs into indirect or direct cost depends on the circumstances under review

Examples involve-

The wage paid to a worker who assembles components for a product is a direct cost while that paid to a worker who is moving components for a range of products from one part of the factory to another is an indirect cost.

b) Fixed cost in relation to labour is where through a worker is paid a fixed weekly wage irrespective of the output produced cost varies directly along with level of activity, as an example of whereas wages are paid at a rate per unit.

c) Variable Labour Cost varies directly along with level of activity, for example where wages are paid per unit.

d) Controllable labour cost is a cost that can be influenced via the actions of a person in whom authority for such control is vested. The control of labour costs will be influenced via the method of remuneration and the degree of management control that is exercised.

Such uncontrollable labour costs cannot be influenced with an officer in the organization, as like an example of, wage rise agitated via the trade union is an uncontrollable labour cost.


Related Discussions:- Classification of labour costs

Limitations of standard costing system, The use of standard costs can prese...

The use of standard costs can present a number of potential problems or disadvantages. Most of these problems result from improper use of standard costs and the management by excep

What is the amount of cost of goods manufactured, Wayne Company's beginning...

Wayne Company's beginning and ending inventories for the month of June were as follows: June 1 June 30 Work in progress $145,000 171,000 Finished Goods 85,000 78,000 Production

Calculate cost for each unit, Dropping a segment - George's Grill analyzes ...

Dropping a segment - George's Grill analyzes profitability of three operating units: restaurant, bar, and billiards room. Revenues, variable costs, and attributable fixed costs (wh

Features of jit, What are the major features of JIT?

What are the major features of JIT?

What are the values for cogs, Given the below information, what are the val...

Given the below information, what are the values for COGS and ending inventory for each costing method below?   Number of Units Price per Unit

Example of methods of allocating service costs, Example of Methods of Alloc...

Example of Methods of Allocating Service Costs Suppose the following data: User department Unit of Service Provided Costs Prior to Service Dep

Calculate the approximate yield to maturity of the bonds, Netflix Inc wants...

Netflix Inc wants to issue discount bonds with a market value equal to 45% of their face value. The income tax rate of Netflix is 30%. The bonds will carry 3.5% coupon, paying inte

Material usage variance (muv), Material Usage Variance (MUV): This is t...

Material Usage Variance (MUV): This is the variation between the actual quantity of material consumed and standard quantity which should have been consumed, expressed in terms

Calculate the variable overhead efficiency variance, Questions 8-10 rely on...

Questions 8-10 rely on the following data. FrontGrade Systems allocates manufacturing over- head based on machine hours. Each connector should require 11 machine hours. According t

Job Order Costing, Bedovin Company manufactures office tables and chairs us...

Bedovin Company manufactures office tables and chairs using the job order cost system

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd