Question

Wilturner Company incurs $89,000 of labor related directly to the product in the Assembly Department, and $38,000 of labor related to the Assembly Department as a whole, and $25,000 of labor for services that help production in both the Assembly and Finishing departments. The amount of direct labor and factory overhead respectively are:

Answer 1

Answer:

Direct Labor 89,000

Factory overhead 63,000

Explanation:

The direct labor will be those employees which work with the product. The remaining of the labor are considered indirect as they cannot be identified with the manufacturing process but are necessary to perform such a process.

Answer 2

Answer:

direct labor = $89,000

factory overhead = 25,000 + 38,000 =$63,000

Explanation:

direct labor cost is a wage that is directly incured to produce a product or provide service to a customer

the services provided are to help production, fixing a plant is help to production but not producing the plant, supervising is helping the production but not producing