.2. Labour Cost: A Practical ExampleQuestion 2 (GWT Break Time (20 Minutes)

Uniform Fitters Limited is an apparel business that produces and sells all sorts of uniforms. The business has recently received an order for 200 blazers from Elegant Sports Club. In response to this order, the production manager decided to form a special team of their most experienced employees, consisting of two cutters and two seamstresses to make the order.

The employees are paid on the following basis:

(i) Cutters: according to material cut per blazer

(ii) Seamstresses: according to the number blazers sewn

The breakdown of employees work for the week ending 10 March 2018 is as follows:

Category	Material cut per blazer	Blazer sewn
Joanna-Cutter 1	35
Rebecca-Cutter 2	31
Hendrika-Seamstress 1		25
Paulina-Seamstress 2		30

Additional information:

? These employees are expected to work for 8 hours per day from Monday to Friday

and

5 hours on Saturday.

? The cutters are paid at the rate of N$ 80 per blazer and seamstresses at N$ 100 per

blazer.

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Our Theme for the day is: Seeing Is Believing!

? The employees will be paid a bonus based on Taylors differential piecework systemset at percentage bonus of 80%.

? These employees are given a transport allowance of N$ 30 per day.Deductions:

? PAYE is 25% of total taxable income.

? Pension fund contribution is 8% of basic pay.

? Social security is 0.9% of basic pay.

? Trade union fee is N$ 25 per employee.

? Paulina has a medical insurance cover for which she contributes 6.5% of her basic

pay.

REQUIRED: All questions should be contextualized.		MARKS
	Calculate:
3.1	Differentiate between direct and indirect labour by using Uniform Fitters Limited as a point of reference.	2
3.2	The bonus to be paid to Joanna and Paulina based on Taylors differentialpiecework system	4
3.3	Prepare a statement showing Paulinas net pay, clearly showing taxable income.	9
TOTAL MARKS FOR QUESTION 3		15