ABMC2054 Cost & Management Accounting I TUTORIAL2: Labour Costing Q1) From the following information, calculate for each employee his earnings using: (a) guaranteed hourly rates only (basic pay) (Ans: RM228 RM144 RM200 RM272) (b) piecework, but with earnings guaranteed at 75% of basic pay where the employee fails to earn this amount, and (Ans: RM228 RM140.40 RM150 RM315) c) premium bonus in which the employee receives two thirds of time saved in addition to hourly pay. (Ans: RM228 RM144 RM200 RM370.67) Employees A B D Actual hours worked 38 36 40 34 Hourly rate of pay(RM) 6 4 5 8 Output(units) X 42 120 120 72 76 - 270 92 50 Standard time allowed (per unit) X - 6 minutes, Y - 9 minutes, Z - 15 minutes. Each minute earned is valued at RMO.10 for piecework calculation. Q2) The following data relate to work in the finishing department of a certain factory. Normal working day 7hours Basic rate of day per hour RM5 Standard time allowed to produce 1 unit 4minutes Premium bonus payable at basic rate 60% of time saved. On a particular day one employee finishes 180 units. What is his gross pay for the day? Q3) The following information is available: Normal working day 8 hours Guaranteed rate of pay (on time basis) RM5.50 per hour Standard time allowed to produce 1 unit 3 minutes Piecework price RMO.10 per standard minute Premium bonus 75% of time saved, in addition to hourly pay Required: For the following levels of output produced in one day: 80 units 120 units 210 units calculate earnings based on (@) piecework, where earnings are guaranteed at 80% of time-based pay; (Ans: RM35.20 RM36 RM63) (b) premium bonus system. (Ans: RM44 RM44 RM54.30)ABMC2054 Cost & Management Accounting I Q4) A worker is paid by differential piecework. The scheme is as follows: up to 50 units per day RM0.50 per unit 51-70 units per day RM0.60 per unit 71-80 units per day RM0.65 per unit 81-100 units per day RM0.70 per unit His daily outputs for a five-day week were 68 units, 83 units, 59 units, 94 units and 47 units. What will be his gross pay for the week? (Ans: RM188.60) Q5) An employee is paid on a piecework basis. The basis of the piecework scheme is as follows: 1 to 100 units -RM0.20 per unit 101 to 200 units RM0.30 per unit 201 to 299 units -RM0.40 per unit With only additional units qualifying for the higher rates. Rejected units do not qualify for payment. During a particular day the employee produced 210 units of which 17 were rejected as faulty. What did the employee earn for their day's work? Q6. A firm's basic rate is RM3 per hour and overtime rates are time and a half for evenings and double time for weekends. The following details have been recorded on three jobs. Job X321 JobX786 JobX114 Clock hours Clock hours Clock hours Normal time 480 220 150 Evening time 102 60 80 Weekend 10 30 16 You are required to calculate the labour cost chargeable to each of the jobs in the following circumstances: (a) Where overtime is worked occasionally to meet production requirements. (Ans: RM1,776 RM930 RM738) (b) Where the overtime is worked at the customer's request to bring forward the delivery time. (Ans: RM1,959 RM1,110 RM906)ABMC2054 Cost & Management Accounting I Q7. Joyce, an employee of Blunis Sdn. Bhd. normally works 40 hours per week. She is paid at standard rate of RM3.60 per hour. On top of that, she would also be paid for all overtime hours she worked at a premium of 50% of the basic hourly rate. During the last week of June, she worked for 50 hours. The table below shows the breakdown of her overtime hours worked: Machine breakdown : 6 hours To complete a special job required by a customer : 4 hours Required: (i) Calculate Joyce's total earnings and show clearly how much would have been treated as direct cost and indirect cost. (ii) Explain on the accounting treatment on the overtime payments incurred for the following situations: Machine breakdown; Specific customer request to speed up the delivery. Q8 A company had 30 direct production employees at the beginning of last year and 20 direct production employees at the end of the year. During the year, a total of 15 direct production employees had left the company to work for a local competitor. What is the labour turnover rate for last year. Q9 A company has 4,000 staff at the start of 2019 and at the end this had reduced to 3,800 due to redundancies being made. 210 staff took voluntary redundancy which was 10 more than the company expected and these 10 employees were replaced. What is labour turnover rate per year (to two decimal places)