The Labor Costs That Have Been Identified as Indirect Labor

question 180

Multiple Choice

The labor costs that have been identified as indirect labor should be charged to

• A) manufacturing overhead.
• B) direct labor.
• C) the individual jobs worked on.
• D) salary expense.

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Definitions:

Materials Cost

The expense incurred to obtain materials required for the production of goods or services.

FIFO Process Cost Method

A method of inventory costing that assumes the first units produced or purchased are the first ones used or sold, standing for "First-In, First-Out."

Finished Goods

Products that have completed the manufacturing process and are ready to be sold to customers.

Work In Process

Partially finished goods that are in various stages of production in a manufacturing company's inventory.