Planning and Controlling Direct Labor Costs

Planning and Controlling Direct Labor Costs Essay example
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Planning and Controlling Direct Labour Costs Name: Grade Course: Tutor’s Name: Date: Outline Introduction…………………………………………………………………….….……….3 Importance of the study…………………………………………………………….….…….3 Analysis…………………………………………………………………………

Introduction

In the current competitive business environment, companies that cannot afford to charge low prices on their products are likely to be excluded from markets. In this regard, cost cutting allows firms to employ low pricing strategy and still make profits (Burns, Quinn, Warren & Oliveira, 2013). Business costs come in many forms. As noted by Burn et al. (2013), manufacturing companies incur expenses in acquisition of raw material and labour among other things. Sometimes it is not easy to assess the value contributed to the company’s product or service by the expenses incurred. According to Burn et al. (2013), many firms find it hard to assess actual contribution of their employees to their products. In this regard, planning and control of direct labour costs is one of the most challenging tasks for businesses. This paper discusses direct labour costs in relation to a soda ash mining company called Tata Chemicals Magadi. Importance of the study Tata Chemicals Magadi has been experiencing financial difficulties in the recent years. As a result, the company hired an expatriate in May this year to help streamline its operations. ...
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