Question

The cost of indirect labour used in the factory is recorded as a
(a) Credit to work in process
(b) Debit to manufacturin
(c) Credit to wages payable
(d) Debit to wages expen​

Answer 1

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Answer 2

The cost of indirect labor used in the factory is recorded as a credit to wages payable. (Option c)

• The cost of indirect labor denotes the wages being paid to indirect laborers.
• It is neither related to goods production nor services performed but related to the workers that make this production and performance of goods and services possible.
• Employees belonging to this category include the administrative and managerial staff.
• The role of indirect labor is to assist the direct labor to perform well.
• Therefore, the cost related to indirect labor does not include the bills related to goods and services.