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Direct labor is a product cost because it varies with the variation in production volume and without this cost no product could be manufactured and directly related with the production of goods.
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Is direct labor a product cost or period cost?
Direct labor is a product cost because without labor no product can be produce and it has direct relation with production of goods.
Is direct labor cost a period cost?
Direct labor is a product cost as it is required to manufacture the units of product, Direct Labor may be a period cost in that period where there is no production but management still paying the labor all salaries and wages.
Is indirect labor cost a period cost?
Indirect labor is considered a period cost because it can't be traced by to the product. If a cost can be traced back to a product, then it is considered a product cost.
Is direct labor a variable cost or product cost?
Direct labor is variable cost as well as product cost but for variable cost it must vary with the change in production level otherwise it will be fixed cost.
Direct labor cost is an example of a period cost?
false
What kind of cost is direct Labor?
Direct labor is direct cost as it varies with variation in production level and directly related with number of units of product.
The variable portion of the semi variable cost of electricity for a manufacturing plant is a conversion cost?
yes A cost that attaches to the physical units is termed a product cost. Product costs would include direct materials, direct manufacturing labor, and manufacturing overhead. Conversion cost is the cost involved in converting the direct materials into a finished product. It is composed of direct manufacturing labor and manufacturing overhead. Any cost that does not attach to the physical units would be termed a period cost and would be expensed as incurred. Therefore, a cost is either a period or a product cost. Electricity cost, whether variable or fixed, would be included in manufacturing overhead and classified as conversion costs, and therefore cannot be classified as a period cost.
Is Direct Material a product cost or period cost?
Direct material is a product cost because without material no product can be produce and it has direct relation with production of goods.
Short note on direct labor?
direct labor is that labor which directly involve in production of goods of product and separately identifiable with cost.
What is difference between product cost period cost and expenses?
Product costs is the costs are the costs incurred in the making of the product. Manufacturing costs --Direct Materials, Direct Labor, and Manufacturing Overhead. Product cost are also factory costs Period costs are the selling and administration costs. Electricity costs for the Accounting dept. is an administration costs but Electricity costs for the factory is Manufacturing Overhead.
Is a direct labor wages a prime cost?
Formula for prime cost is as follows: prime cost = direct material + direct labor So according to above mention formula yes it is prime cost because whitout labor no unit of product can be manufactured.
What is the average direct labor cost in manufacturing?
Average direct labor cost is the opening direct labor cost + closing direct labor cost / 2
