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Labour (direct indirect)

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA MA – FIA FMA › Labour (direct indirect)

  • This topic has 3 replies, 2 voices, and was last updated 2 months ago by John Moffat.
Viewing 4 posts - 1 through 4 (of 4 total)
  • Author
    Posts
  • November 24, 2022 at 4:24 am #672375
    aydinabasov
    Participant
    • Topics: 3
    • Replies: 3
    • ☆

    There is this question in BPP which I cannot understand
    Jaffa Co employs two types of labour: skilled workers(direct labour) and semi skilled workers(indirect labour). Skilled labours are paid $ 10 per hour and semi skilled are paid $ 5 per hour.

    Skilled labour works 20 hours overtime, 12 on specific order and 8 on general
    Overtme is paid at time and quarter.
    Semi skilled worked 30 hours overtime, 20 hours for a specific order at a customer’s request and the rest for general purposes . Overtime is paid at time quarter

    On the answer i understood that 20 hour overtime is direct cost because he worked on SPECIFIC order.

    But why we consider GENERAL overtime hour as a direct cost.

    Please help me to understand this point. Thank you

    November 24, 2022 at 8:36 am #672388
    John Moffat
    Keymaster
    • Topics: 56
    • Replies: 51563
    • ☆☆☆☆☆

    Have you watched my free lectures on this, because I do explain which costs are regarded as direct and which are regarded as indirect.

    November 26, 2022 at 4:19 pm #672647
    aydinabasov
    Participant
    • Topics: 3
    • Replies: 3
    • ☆

    I watched many times and i got everything. Please help me about this question.
    I though only specific overtime cost will be direct.

    November 27, 2022 at 9:16 am #672727
    John Moffat
    Keymaster
    • Topics: 56
    • Replies: 51563
    • ☆☆☆☆☆

    The question says that the semi-skilled workers are indirect labour, and therefore all of their pay is an indirect cost.

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