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Direct Labor Cost Examples

>> August 19, 2010

In cost accounting, there is not a hard and fast rule in direct labor cost examples. Different factories or production plants may have different labor cost according to the nature of production. it is the type of labor which is directly related with the manufacturing of product in factory Like people directly working on machines for production of goods. But of main direct labor Cost Examples are being mentioned here.

1. Wages

The amount which is paid by company to laborer for production of products. This is example of direct labor cost.

2. Payment of Subsidised Food

The amount which is paid by company for providing the food at subsidised rates to laborers, will be the example of direct labor cost.

3. Subsidised Housing

If company is getting less rent from worker for providing homes, different between actual rent and taken rent will be the example of direct labor cost.

4. Educational Benefits to Children of Workers

All educational benefit's price which are being given to the children of workers will be the example of direct labor cost.

5. Other Benefits

For showing correct prime cost in cost sheet, we will add bonus, allowances and other parks or benefits in direct labor cost.

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