Labor is an important factor of production. It represents human contribution to production. Despite a large number of mechanical devices and computerization, the role labor plays in the process of production can never be under-estimated. its efficiency, its skill, and its proper utilization is most important in any process of production. Proper accounting and control of labor cost is, therefore, most significant in any costing system.
In this article, we are trying to explain some important techniques and formulas to calculate labour cost, payroll and incentive wages. 1. Measurement of Labour Turnover (a). Separation method: Labour Turnover = (No. of separations in a period / Average No. of Workers) x 100 LT = (NS / ANW) x 100 (b). Replacement Method …
Question No. 1 Calculate total monthly remuneration of three workers: A, B and C. (a). Standard production per month per worker 1,000 units. (b). Actual production during the month: A: 850 units B: 750 units C: 950 units (c). Piece work rate is 10 cents per unit (actual production) (d). Additional production bonus is $10 …
What are Incentive Plans? – definition Incentive Plans are the techniques in which an organization keeps its employees motivated to perform their specific tasks with more effort and efficiency and pay several incentives to complete those tasks. Advantages of Incentives Generally, the following advantages result from the introduction of incentive plans in a factory: Rate …
There are two methods of time-keeping: 1. Manual Methods which are divided into dance Register or Muster Roll and (ii) Check, Token or Disc Method. 2. Mechanical Methods which are divided into Time Clock Method : (a) Dial Recorder System and (b) Key Recorder System. 1. Manual Methods of Time-Keeping (a). Attendance Register or Muster …
Direct labor Direct labor refers to that labor which can conveniently been identified or attributed wholly to a particular job, product or process. It is employed directly on the production work. Direct labor is that labor which is used in converting raw material into finished goods. It helps in altering the construction, Composition or condition …
Difference between Direct and Indirect Labor Cost Read More »