Direct Labour

question 19

Multiple Choice

Direct labour:

• A) Always flows into an overhead T-account
• B) Is recorded to each custom product or service
• C) Cannot be easily traced to a custom product or service
• D) Is not used in service sector job costing

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Definitions:

Weighted-Average Method

An inventory costing method that assigns costs based on the average cost of all units available during the period.

Equivalent Units

A concept used in cost accounting to convert partially completed goods into the equivalent of full units of output, facilitating consistency in financial reporting and analysis.

Fabricating Department

A division within a manufacturing company dedicated to the construction and assembly of the parts required to produce a finished product.

FIFO Method

An inventory valuation method that assumes that the first items placed in inventory are the first sold, standing for First-In, First-Out.