The Big Plastic Company manufactures a variety of plastic utensils, employing approximately 400 factory workers. Supervisors are paid a salary for a 40-hour week but receive overtime for hours worked in excess of 40. Supervisor’s record hours worked on a weekly time card, clocking in and out at the beginning and end of each day. Factory workers are paid on an hourly basis. Activity rates are assigned to the operation of various machines in the factory; a worker assigned to a machine is paid the higher of either the machine’s activity rate or the standard hourly pay rate. Workers clock in and out of each assigned activity on a daily basis. Supervisors record the activity code and elapsed time for each entry on a machine operator’s daily time card. Supervisors maintain a record of machine operator overtime. All workers must account for 8 hours a day and receive time-and-a-half for hours worked in excess of 8 hours per day.
A timekeeper collects time cards on a daily basis. Supervisors’ time cards are collected at the end of each week. Time cards are compared to an authorized employee list, initialed by the timekeeper, and forwarded to the payroll department.
In the payroll department, a clerk verifies the time-keeper initials, batches the cards in groups of 40 or fewer cards, and prepares a pre-numbered batch control form for each batch. This form contains total regular hours, overtime hours, date, and number of documents in the batch. The payroll clerk transcribes the contents of each batch control form onto an input batch control log to record and maintain control of each batch. The time cards are then submitted to the computer processing department, where they are key-transcribed, verified, and processed by a payroll system edit program to produce a detailed listing of the input items. At the end of the listing, control totals are printed for the valid and rejected items. If any item in a batch is rejected, then all items in the batch are rejected to maintain batch integrity. The payroll clerk corrects rejected items, prepares a new batch control form using the original batch number plus a suffix to identify the batch as a correction batch, and resubmits the batch to the computer processing department.
This procedure is repeated throughout the week until all errors have been corrected.
The payroll is processed weekly to produce an updated payroll master file, employee checks, and payroll register. These reports are distributed to the payroll department, where reconciliation with the input controls is performed.

Flow-chart the preceding payroll procedure.

  • CreatedFebruary 26, 2015
  • Files Included
Post your question