- 15 Marks
Question
There are six workers in a production department of a manufacturing company: Ayo, Bola, Cosmas, Dapo, Eniola, and Alasa. The following information is extracted from the company’s records for the month: Standard production per month is 1,250 units.
Production by each employee:
- Ayo: 1,000 units
- Bola: 1,250 units
- Cosmas: 1,375 units
- Dapo: 900 units
- Eniola: 1,125 units
- Alasa: 1,200 units
Piecework rate is N100.00 per unit of actual production.
Additional bonus is N200.00 for each 1% of actual production above 80% of the standard production. There’s also a production allowance of N5,000 per month.
Required:
Compute the total remuneration for the workers for the month.
Answer
Calculation of Total Remuneration for Each Worker:
Explanation:
- The total remuneration is calculated by adding the piecework pay, the additional bonus for each worker, and the production allowance. The bonus is computed based on the percentage of actual production above 80% of the standard production. For example, if the production is 90%, the bonus will be 10% over 80%, and for each 1%, the worker earns an additional N200.
- Tags: Bonus calculation, Piece Rate System
- Level: Level 1
- Topic: Costing Methods
- Series: NOV 2023
- Uploader: Theophilus