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Throughput Accounting Ratio

Forums › Ask CIMA Tutor Forums › Ask CIMA P2 Tutor Forums › Throughput Accounting Ratio

  • This topic has 1 reply, 2 voices, and was last updated 7 years ago by Cath.
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  • September 23, 2017 at 11:26 am #408415
    robmcclay
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    • Topics: 1
    • Replies: 0
    • ☆

    Hi!

    When calculating total factory costs for the throughput accounting ratio, do you include the direct labour costs?

    I’ve seen some answers to questions that do and some that don’t?

    I believe that you do!

    Thanks,
    Rob.

    September 25, 2017 at 10:04 am #408584
    Cath
    Participant
    • Topics: 0
    • Replies: 448
    • ☆☆☆

    You are correct.
    In throughput accounting labour is always classed as a fixed cost so needs to go together with other production overheads to make total factory costs.

    Kind Regards
    Cath

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