# Direct materials, direct labor, and factory overhead Identify the following costs as direct materials (DM), direct labor (DL), or factory overhead (FO) for a magazine publisher: a. Staples used to bind magazines b. Wages of printing machine employees c. Maintenance on printing machines d. Paper used in the magazine

BuyFind

### Accounting

27th Edition
WARREN + 5 others
Publisher: Cengage Learning,
ISBN: 9781337272094
BuyFind

### Accounting

27th Edition
WARREN + 5 others
Publisher: Cengage Learning,
ISBN: 9781337272094

#### Solutions

Chapter
Section
Chapter 18, Problem 18.2BPE
Textbook Problem

## Direct materials, direct labor, and factory overheadIdentify the following costs as direct materials (DM), direct labor (DL), or factory overhead (FO) for a magazine publisher: a. Staples used to bind magazines b. Wages of printing machine employees c. Maintenance on printing machines d. Paper used in the magazine

Expert Solution

(a)

To determine

Direct Material cost:

Direct material cost is the cost of the material which is directly involved in the production. It constitutes the major portion of the total cost of the finished product. For example: The cost of plastic is the direct material for manufacturing a bottle.

Direct Labor Cost:

Direct labor cost is the cost of the labor paid to the employees who are directly involved in converting the raw materials to the finished products. It constitutes the major portion of the total cost of the finished product. For example: Wages paid to the mechanic for repairing an automobile.

Factory Overhead Cost:

Factory overhead cost is the cost other than the direct material cost, and the direct labor cost which is not directly involved in the production process of converting the raw materials to the finished products. If the direct material cost or direct labor cost does not constitute the major portion of the total cost of the finished product, then it may be classified as the factory overhead cost. For example: Cost of repairing, and maintaining factory equipment.

To identify: The given costs as direct materials (DM), direct labor (DL), or factory overhead (FO) for a magazine publisher.

### Explanation of Solution

The cost of the staples used to bind magazines is Direct material (DM) or Factory overheads cost (FO)

The cost of the staples used to bind magazines is the cost which is directly involved in the production...

Expert Solution

(b)

To determine

To identify: The given costs as direct materials (DM), direct labor (DL), or factory overhead (FO) for a magazine publisher.

Expert Solution

(c)

To determine

To identify: The given costs as direct materials (DM), direct labor (DL), or factory overhead (FO) for a magazine publisher.

Expert Solution

(d)

To determine

To identify: The given costs as direct materials (DM), direct labor (DL), or factory overhead (FO) for a magazine publisher.

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