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Why Might a Company Use Direct Labor Cost as an Overhead

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Why might a company use direct labor cost as an overhead allocation base rather than using direct labor hours?


Definitions:

Bowel Obstruction

A medical condition where there is a blockage in the intestines that prevents gas, fluids, or solids from moving through normally.

Chronic Cathartic

Long-term use of laxatives, which can be harmful and lead to dependency.

Ileus

A temporary and often painful condition in which there is a lack of movement in the intestines, leading to a buildup of food, fluid, and gas, and causing abdominal swelling and discomfort.

Fecal Occult Blood

Small amounts of blood in feces that are not visible to the naked eye but can be detected through specific tests.

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