Direct labor cost is a part of wage-bill or payroll that can be specifically and consistently assigned to or associated with the manufacture of a product, a particular work order, or provision of a service.
In the direct labor cost we need to have the job time and wage we will pay it to the worker to calculate the direct labor cost as in this formulation:[1]- Depending on the context, there are various methods to calculate personnel costs, such as on an hourly or daily basis.
[2] The wage is the payment rendered to the worker per hour as a compensation for the work done.
The job time needs to be measured by one of the following ways:[3]
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