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Sagot :
Ideally Tanner Company Make the part since it will cost $2 less to make than to buy.
How Much Does Direct Labor Cost?
Direct labor costs are the total expenses incurred by the business for paying employees' wages and other perks in exchange for work that is directly relevant to the production of the business's goods or the rendering of its services.
The other important components of the company's product cost are direct material costs and manufacturing overhead costs. It is one of those components.
The amount paid to full-time employees, part-time employees, temporary employees, and workers hired on a contractual basis who are directly involved in the production or processing of the goods can all be included in the company's total compensation.
The wages provided to the employees are simply one component of the total cost of the direct labor expense. It also includes any additional fees that are paid that are directly tied to the products, like payroll taxes deducted from employee paychecks, insurance for workers' compensation, life insurance, health insurance, and other company perks. for the delivery of the services or for a corporate product.
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