why could direct labor be considered a variable cost?
Homework Answers
Variable costs are costs which changes with change in sales and production activity.
Direct labor is variable cost because it is directly related to production / manufacturing activity. As production increases the direct labor proportionately increases to that extent and as production decreases the direct labor proportionately decreases to that extent.
Example:
Unit produce: 100
Material cost: $1/Unit and Labor cost: $3/Unit
Total cost will be = 100 x (1+3) = $400 (Labor cost is $300)
If we increase unit produce to 200 units then total cost will be = 200 x (1+3) = $800 (Labor cost is $600)
So, direct labor cost is increasing as it is variably and directly related to unit produce.
which of the following is considered a variable manufacturing overhead cost? Factory rent Direct labor c...
which of the following is considered a variable manufacturing overhead cost? Factory rent Direct labor c Factory utilities d. Direct materials Which of the following costs is considered a direct cost? Depreciation on machinery b. Glue used in the manufacturing process c. The superintendent's salary d. Factory insurance c. Assembly-line labor costs The cost of rent for a manufacturing plant is generally considered to be a: Fixed cost Overhead cost No Yes No No No Yes Yes Yes When production...
Assuming that direct labor is a variable cost, product costs under variable costing include only: direct...
Assuming that direct labor is a variable cost, product costs under variable costing include only: direct materials and direct labor direct materials, direct labor and variable manufacturing overhead direct materials, direct labor, variable manufacturing overhead, and variable selling and administrative expenses direct materials, variable manufacturing overhead, and variable selling and administrative expenses
Which of the following should not be considered in the calculation of direct labor cost? A....
Which of the following should not be considered in the calculation of direct labor cost? A. The employer’s portion of social security and unemployment taxes B. The wage rate for each employee multiplied by the number of hours each employee works on each job C. Fringe benefits given to an employee who works on a job D. Overtime pay to an employee as a result of production problems not related to a specific job
In the first year of operation, Ajax manufacturing incurred direct labor cost (variable cost) of $80,000...
In the first year of operation, Ajax manufacturing incurred direct labor cost (variable cost) of $80,000 and produced 10,000 units. In year 2 they expect to produce 12,000 units with no change in cost structure. Their expected direct labor cost per unit would be? Multiple Choice $12 $8 $5.33 $6.67
Which of the following can be considered as variable cost? Select one: A. Direct Material and Manufacturing overhead. B...
Which of the following can be considered as variable cost? Select one: A. Direct Material and Manufacturing overhead. B. Manufacturing Overhead. C. Direct Material and Direct Labour. D. Direct Labour and Manufacturing Overhead.
Prime cost is direct materials cost and direct labor cost. indirect materials cost and direct labor...
Prime cost is direct materials cost and direct labor cost. indirect materials cost and direct labor cost. direct labor cost and indirect labor cost. direct materials cost and indirect labor cost.
Highfill Corporation's variable overhead is applied on the basis of direct labor-hours. The standard cost card...
Highfill Corporation's variable overhead is applied on the basis of direct labor-hours. The standard cost card for product D80D specifies 6.4 direct labor-hours per unit of D80D. The standard variable overhead rate is $5.90 per direct labor-hour. During the most recent month, 1,100 units of product D80D were made and 7,100 direct labor-hours were worked. The actual variable overhead incurred was $45,230. Required: a. What was the variable overhead rate variance for the month? b. What was the variable overhead...
Total direct labor-hours:101,000 Total fixed manufacturing overhead cost: $595,900 Variable manufacturing overhead per direct labor-hour: $3.00...
Total direct labor-hours:101,000 Total fixed manufacturing
overhead cost: $595,900 Variable manufacturing overhead per direct
labor-hour: $3.00
loughamy waketech edu My Turbo Tax Login Signint x f Me 2019 Connect Required: Ch 2 Quiz Saved Help Save & Exit Submit Dehner Corporation uses a job-order costing system with a single plantwide predetermined overhead rate based on direct labor-hours. The company based its predetermined overhead rate for the current year on the following data: points Total direct labor-hours Total fixed manufacturing overhead...
Cost per Period Cost per Unit $7.35 $4.30 $1.60 Direct materials Direct labor Variable manufacturing overhead...
Cost per Period Cost per Unit $7.35 $4.30 $1.60 Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Sales commissions Variable administrative expense Fixed selling and administrative expense $26,000 $0.80 $0.90 $ 6,000 If 6,500 units are sold, the total variable cost is closest to: Multiple Choice 0 $106.925 O $128.375 O $97,175 0 $86,125
Total direct labor-hours 40,000 Total foxed manufacturing overhead cost $ 96,000 Variable manufacturing overhead per direct...
Total direct labor-hours 40,000 Total foxed manufacturing overhead cost $ 96,000 Variable manufacturing overhead per direct labor-hour $ 3.00 Recently, Job P951 was completed with the following characteristics: Number of units in the job 20 Total direct labor-hours 150 Direct materials $ 755 Direct labor cost $ 5,000 The total cost for Job P951 is closest to: O $6,205 O $5.755 O $1,565 $6,565
which of the following is considered a variable manufacturing overhead cost? Factory rent Direct labor c Factory utilities d. Direct materials Which of the following costs is considered a direct cost? Depreciation on machinery b. Glue used in the manufacturing process c. The superintendent's salary d. Factory insurance c. Assembly-line labor costs The cost of rent for a manufacturing plant is generally considered to be a: Fixed cost Overhead cost No Yes No No No Yes Yes Yes When production...
In the first year of operation, Ajax manufacturing incurred direct labor cost (variable cost) of $80,000 and produced 10,000 units. In year 2 they expect to produce 12,000 units with no change in cost structure. Their expected direct labor cost per unit would be? Multiple Choice $12 $8 $5.33 $6.67
Which of the following can be considered as variable cost? Select one: A. Direct Material and Manufacturing overhead. B. Manufacturing Overhead. C. Direct Material and Direct Labour. D. Direct Labour and Manufacturing Overhead.
Total direct labor-hours:101,000 Total fixed manufacturing
overhead cost: $595,900 Variable manufacturing overhead per direct
labor-hour: $3.00
loughamy waketech edu My Turbo Tax Login Signint x f Me 2019 Connect Required: Ch 2 Quiz Saved Help Save & Exit Submit Dehner Corporation uses a job-order costing system with a single plantwide predetermined overhead rate based on direct labor-hours. The company based its predetermined overhead rate for the current year on the following data: points Total direct labor-hours Total fixed manufacturing overhead...
Cost per Period Cost per Unit $7.35 $4.30 $1.60 Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Sales commissions Variable administrative expense Fixed selling and administrative expense $26,000 $0.80 $0.90 $ 6,000 If 6,500 units are sold, the total variable cost is closest to: Multiple Choice 0 $106.925 O $128.375 O $97,175 0 $86,125
Total direct labor-hours 40,000 Total foxed manufacturing overhead cost $ 96,000 Variable manufacturing overhead per direct labor-hour $ 3.00 Recently, Job P951 was completed with the following characteristics: Number of units in the job 20 Total direct labor-hours 150 Direct materials $ 755 Direct labor cost $ 5,000 The total cost for Job P951 is closest to: O $6,205 O $5.755 O $1,565 $6,565
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