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October 23, 2014

Homework Help: Direct Labor: Variable or Fixed Cost?

Posted by George on Thursday, November 18, 2010 at 1:24pm.

Throughout the corporate world, businesses are transforming labor into a more flexible (and variable) cost. Among such companies are Hewlett-Packard, General Electric, DuPont, Sun Microsystems, and British Airways. Discuss whether direct labor is a fixed or a variable cost. What are the pros and cons of management treating direct labor as a variable cost? Are there ethical issues to be considered here?

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