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Direct/indirect expense

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA PM Exams › Direct/indirect expense

  • This topic has 1 reply, 2 voices, and was last updated 1 year ago by LMR1006.
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  • December 18, 2023 at 4:05 am #696973
    krrish2005
    Participant
    • Topics: 138
    • Replies: 229
    • ☆☆☆

    Sir i am having doubt while revising my concepts of MA kindly help:
    1)Sir if a supervisor is oveeseeing the work of labor related to a specific product will be direct or indirect labor?

    2) Also rent of a factory where only one /specific product is produced is direct or indirect expense?

    December 18, 2023 at 9:44 am #696992
    LMR1006
    Keymaster
    • Topics: 4
    • Replies: 1505
    • ☆☆☆☆☆

    A supervisor oveeseeing the work of labour related to a specific product will still be indirect as they are supervising, not involved in production.

    The cost of renting a factory where say shirts are manufactured is classified as an indirect cost because it would be virtually impossible to relate such costs to shirts only, if other clothes, such as dresses and suits were also made in the same factory. If it does make shirts only then it is direct.

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