Throughput Accounting Ratio

This topic has 1 reply, 2 voices, and was last updated 8 years ago by Cath.

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September 23, 2017 at 11:26 am #408415
robmcclay
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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
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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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