ACCA Applied Knowledge · Management Accounting · Cost classification
Which of the following is an example of indirect labour in a manufacturing company?
The factory supervisor's wages are indirect labour because the supervisor oversees production generally and the cost cannot be traced to particular units. Machinists and assemblers working on products are direct labour.
- AWages of a factory supervisorCorrect
- BWages of a machinist producing goods
- CWages of an assembler working on a customer order
- DWages of a worker converting raw materials into units
Explanation
A supervisor oversees production generally and cannot be traced to specific units, so the cost is indirect labour. The other roles are directly involved in making products.
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