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Businesses use a method to reduce labor costs called outsourcing. This is where a company that employees a significant number of employees at some particular time but may not need as many employees at other times. The large swing in employment numbers inhibits the hiring of full time staff so a third party is contracted (outsourced) to perform the required task. The third party may perform the same task for many customers.
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Do I have to calculate Cost of Goods Sold if the business uses the Cash acounting system?
Costs of goods sold are a type of expense and although the total may vary between the accrual and cash basis' of accounting, the method of calculating them is the same. Beginning Inventory + Purchases - Ending Inventory = Costs of Goods Sold. If you have no beginning or ending inventory (because you're using the cash basis)... you just add the purchases and applicable expenses. Some of which might be: direct materials and supplies, energy costs, freight, direct labor costs, etc.
What does BoQ mean?
In the business world, BoQ means "bill of quantities." A bill of quantities is a document used in tendering in the construction industry in which materials, parts, labor, and labor costs are itemized.
How can internet technologies be involved in improving a process in one of the functions of a business choose one example and evaluate its business value?
Improvements in data capture costs, data quality, cycle-time reductions, and increased information availability.Example: a web-based form through which customers may place their own product orders. Such a form would reduce transcription errors by shrinking the communications chain, enable real-time error checking, reduce telecommunications and labor costs, increase the organization's market-space presence, and enable real-time transaction reporting.
True or false direct labor-hours or direct labor cost should not be used as a measure of activity in an activity-based costing system?
False
Manufacturing overhead is 20 direct labor is 45000 and direct materials are 53000 what is the manufacturing overhead?
20
Why do US companies outsource jobs?
To reduce labor costs
What does labor costs mean?
Labor cost means the direct labor cost incurred by business to manufacture units of products to be sold.
What costs are direct labor costs?
Salaries and wages of workers directly involve in goods manufacturing is direct labor cost.
In order to reduce labor costs what might a company do?
some companies have outsourced jobs to Another Country as they can reduce labor costs that way.
Costs can either be prime costs or conversion costs but not both?
direct labor
What is the Direct cost in shoe manufacturing business?
Following are direct costs of shoe manufacturing business:1 – Leather (Direct material)2 – Workers salary on machine (direct labor)3 – Electricity expense etc
What do companies use offshoring to do?
Reduce labor costs
Is Direct Labor included in Overhead costs?
Direct labor are not part of overhead costs and shown separately while indirect labor are part of overhead costs and included in overhead cost because those labor cannot be allocated separately or identifiable separately.
Is direct material and labor a fixed cost?
If direct material and direct labor remains fixed irrespective of production volume then these are fixed costs otherwise these are variable costs and normally these are variable costs because it varies with the production volume.
What is the formula to calculate conversion costs?
it is direct labor plus overhead costs
What are prime cost?
Prime Costs: Prime costs are those costs which are prime importance for making any product and include: Prime Cost = Direct Material + Direct Labor
Does out sourcing reduce direct labor?
Yes it depends on contract if all workers are daily based then these workers don't need to be paid but if even in outsource this labor is paid then it will not reduce the direct labor much.
