Normal idle time should be:
ARecovered from worker
BCharged to costing P&L
CCharged to production
DCapitalised
Answer & Solution
Correct answer: C. Charged to production
1. Normal idle time is unavoidable and inherent to the production environment.
2. Its cost is absorbed by inflating the labour cost rate on productive hours.
3. Effectively the cost is charged to production.
4. Abnormal idle time, in contrast, is charged to the costing P&L.
_Source: ICAI BoS Inter Paper 3, Ch 3 "Employee Cost", §3.4.1 ¶2_
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