search: Business Empire Magazine (get error when i put link)they have a lot of information on cost efficient ways to build and grow a business. The general information should be able to answer your questions
      Answer1:Labor is typically Line 11 on the Schedule C. Just add up the amounts you paid other people to perform labor. You probably want to type up Invoices to back up your costs. Invoice from you to them. Check the IRS website for guidelines on if you need to do 1099s. www.irs.gov