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Labor Exercise - Cost Accounting

This document contains 10 problems related to cost accounting concepts like labor costing, premium plans, piece rate plans, and inventory costing. Specifically, it provides information needed to calculate earnings under different premium plans like Halsey and Rowan plans. It also includes problems on calculating wages using Taylor's differentiated piece rate method and inventory costs using economic order quantity models. Journal entries related to labor cost calculations involving deductions are presented.

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Kolins Chakma
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519 views3 pages

Labor Exercise - Cost Accounting

This document contains 10 problems related to cost accounting concepts like labor costing, premium plans, piece rate plans, and inventory costing. Specifically, it provides information needed to calculate earnings under different premium plans like Halsey and Rowan plans. It also includes problems on calculating wages using Taylor's differentiated piece rate method and inventory costs using economic order quantity models. Journal entries related to labor cost calculations involving deductions are presented.

Uploaded by

Kolins Chakma
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Cost Accounting

Labor

Problem #1
You are given the following information
Standard time 20 hours
Time taken 16 hours
Rate per hour $125
Compute the earnings-
a) Time Rate Basis
b) Halsey Premium Plan
c) Rowan Premium Plan

Problem #2
Time allowed 75 hours
Time taken 60 hours
Rate per hour $100
Dearness allowance $96 per day of 8 hours. Compute total wages under-
a) Halsey Premium Plan
b) Rowan Premium Plan

Problem #3
Standard time allowed for a job is 40 hours and rate per hour $4. Because of saving time a
worker gets an hourly wage of $4.60 under Rowan Premium Method. For this same savings
of time, find out the hourly rate wages under Halsey Premium Method.

Problem #4
Rate per hour $2
Time allowed 10 hours
Time taken 8 hours
Calculate-
a) Halsey Premium Plan
b) Halsey-Weir scheme

Problem #5
A factory operates 8 hours a day. The following information are-
Standard production per hour 10 units
Normal wages per hour $125
One week = 6 days

Rates applicable-
75% of piece rate for bellow standard
100% of piece rate for standard
125% of piece rate for above standard

1
Cost Accounting

Production during the week was as follows-


A 400 units, B 480 units, C 520 units, D 470 units
Compute the earnings of the worker under Taylor’s Differentiate Piece Rate Method.

Problem #6
Standard production 1000 units
Rate per hour $2.50
Production bonus $10 for each percent of actual production exceeding 75% of standard.
House rent $100 per worker
In a day of 10 hours, A produced 850 units, B produced 750 units and C produced 900 units.
Compute the amount of wages payable to the workers.

Problem #7
Calculate the wages payable to a worker from the following information-
Days Sat Sun Mon Tue Wed Thu
Hours
9 10 12 8 11.50 4
worked

Normal working hours per day is 8 hours. Rate per hours is $10. Overtime rate up to 9 hours
at single rate and over 9 hours in a day add double rate.
Alternatively up to 48 hours in a week at single rate and over 48 hours in a week add double
rate. Whichever is beneficial to a worker.

Problem #8
a) What is EOQ? Why is it done?
b) Sun-moon Ltd. Buys lots of 1000 boxes which is a 3 months supply. The cost per box is
$500 and the ordering cost is $300. The inventory carrying cost is estimated at 20% of unit
value.
Required-
i. What is the total annual cost of the existing inventory policy?
ii. How much money could be saved by employing the EOQ?

Problem #9
From the following particulars calculate net wages payable and show the necessary journal
entries in cost and financial accounts.

Time as shown by time card 60000 hours. Rate per hour is $10. Determine made from gross
wages. Deductions made from gross wages-
Provident fund 12%
Income tax is $ 30,000
Social security fund 10%
The job card indicate 75% direct and the rest indirect labor.

2
Cost Accounting

Problem #10
In a factory 4 workers A,B,C,D worked together as a team and paid a group piece rate. They
also worked individually on day rate basis. In 44 hours work the following hours where spent
by A,B,C,D on group basis-
A 40 hours
B 40 hours
C 30 hours
D 20 hours

The balance time has been booked by each worker on a day rate basis. Hourly wage rate
are-
A $50
B $75
C $100
D $100

Group piece rate is $100 per unit and the team produced 150 units. Dearness allowance is
$200 per week. Find out this wages.

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