Direct labor cost also includes training and benefits

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Between January 1st and December 31st of 2018, Erie Corporation paid its employees $21.39 million. However, its Income Statement shows a direct labor expense of only $19.39 million. Which of the following statements accurately explains the difference? choose one

1. Direct labor cost also includes training and benefits

2. Direct labor cost also includes social security (FICA) tax

3. Direct labor cost is the labor component of the inventory that was sold, and may include inventory produced in prior years

4. Direct labor cost also includes management and non-hourly salaries

Reference no: EM13987788

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