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Quick Question - Indirect Labor

Would you consider Supply Chain/Purchasing Wages to be indirect labor?

I feel like the accounting principles are a bit grey in terms of what you can and cannot include within the costing of inventory.

Answers

Topic Expert
Wayne Spivak
Title: President & CFO
Company: SBAConsulting.com
LinkedIn Profile
(President & CFO, SBAConsulting.com) |

I would treat them as indirect labor. They are not directly involved in the manufacture of a WIP or Finished Good. They are part of the team, such as administration, janitors and delivery truck drives that aid in the business, but not the manufacturing line.

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