accounting question?

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accounting question?

How does a merchandising company account for labor?

2007-09-13 05:47:43 · 2 answers · asked by marianne d 2 in Business & Finance ➔ Corporations

2 answers

Since you don't manufacture any goods, you don't have direct labour. You only need to segregate selling from general and admin salaries (all of which are period costs), especially if your boss needs to know the cost of running the sales dept and if you have lots of sales staff running around trying to get sales for the co.

2007-09-13 20:05:22 · answer #1 · answered by Sandy 7 · 0⤊ 0⤋

Labor is expensed as it is consumed since there are no manufactured goods in which to capitalize it.

2007-09-13 14:04:33 · answer #2 · answered by Flyboy 6 · 0⤊ 0⤋