Account 622 - Direct labor cost
1. Accounting Principles
This account is used to record costs of direct labor participating in activities of manufacturing and trading in industry, construction, agriculture, forestry and fishery, services (traffic and transportation, posts and telecommunications, hotel, travel, consulting...)
Costs of direct labor consists of accounts payables for laborers who belong to business employees list, directly manufacturing products, supply services and cost of out soured laborers in various type of works, such as: salary, wage, subsidiaries, appropriation from salary (social insurance, medical insurance, labor union fees, unemployment insurance).
b) Salaries and wages payables and subsidiaries for factory employees, managerial employees, of business, management, sales employees shall not accounted to this account.
c) Construction activity, salary, wage, supplement of salaries payables for workers who directly manage trucks, machinery, serve, machinery operation, appropriation of social insurance, medical insurance, fees of labor union computed on salary fund payables to direct workers of construction activity, handling of machinery, serving machinery, factory employees shall not be accounted to this account.
d) Account 622 must be opened in details for costs objects of manufacturing and trading.
dd) Part of costs: of direct labors in excess of normal level is not added to costs of products, services, but must be posted directly to Account 632 ―Cost of goods sold‖

2. Structure and contents of account 622 - Direct materials cost
Debit side : Costs of direct labors participating in process of manufacturing products, and rendering services, in clued: salaries, wages and appropriation of salaries, wages as regulated in the period.
Credit side :
- Closing out costs of direct labor to Debit of Account 154 ―Work in process‖ or to Account 631 ―Cost of production‖.
- Transferring costs of direct labor in excess of normal level to Account 632.
Account 622 does not have ending balances.

3. Method of accounting for several major transactions
Basing on payroll to record amounts of salaries, wages and other payables for direct labors that produce products, render services
Dr 622 - Direct labor cost
Cr 334 - Wages payable
b) Computing, extracting social insurance, medical insurance, budget of labor union, unemployment insurance, support (such as life insurance, voluntary pension insurance...) of workers directly manufacturing products, render services (Amounts added to business expenses payables) computed on salaries, wages payables as regulated, record:
Dr 622 - Direct labor cost.
Cr 338 - Other payables (3382, 3383, 3384, 3386).
c) When advancing vacation salaries of production workers, record
Dr 622 - Direct labor cost
Cr 335 - Accrued expenses
d) When production workers are actually in leave, accountants record amounts payables leave salary of production workers, record:
Dr 335 - Accrued expenses
Cr 334 - Wages payable
dd) For the cost of labor used generally for business cooperation contract
- When incurring labor costs generally used for business cooperation contracts, based on invoices and related documents, record :
Dr 622 - direct labor cost (detail for each contract)
Cr 111, 112, 334...
- Periodically, accountants establish general cost allocation Statement (with the confirmation of the parties) and deliver VAT invoices to allocate the cost of labor used generally for business cooperation contract for the parties, record :
Dr 138 - Other receivables (details for each partner)
Cr 622 - Direct labor cost
Cr 3331 - payable VAT
In case of distribution of costs without VAT invoices, accountant record a decrease of input VAT by recording Cr 133 - deductible VAT.
e) At the end of accounting period, allocating and transferring costs of direct labors to Debit of Account 154, to Debit of Account 631, according to costs objects, record:
Dr 154 –Work in process, or
Dr 631 - Costs of production (periodical inventory method)
Dr 631 - Cost of goods sold (part in excess over normal level)
Cr 622 - Direct labor cost.

Source: Circular 200, Article 85