ECONOMICS

Detailed explanation-1: -Direct manufacturing labor costs include the compensation of all manufacturing labor that can be traced to the cost object in an economically feasible way. be traced to that cost object in an economically feasible way. Other terms for this cost category include manufacturing overhead costs and factory overhead costs.

Detailed explanation-2: -A direct cost can be traced to the cost object, which can be a service, product, or department. Direct costs examples include direct labor and direct materials. Although direct costs are typically variable costs, they can also be fixed costs.

Detailed explanation-3: -Manufacturing overhead costs are all manufacturing costs that are related to the cost object (work in process and then finished goods) but cannot be traced to that cost object in an economically feasible way. Prime costs are all direct manufacturing costs (direct material and direct manufacturing labor).

Detailed explanation-4: -For instance, a product produced by a company is the cost object for direct materials, direct labor and manufacturing overhead.

Detailed explanation-5: -Direct labor costs are a function of the wages paid (including all costs to the manufacturer of employing a worker), the number of laborers necessary to run the process, and the paid operating time.