Abstract:
Labor cost is a significant element of cost especially in an organization using more manual operations. It is the cost of human endeavour in the product and requires coordinated efforts for its control. The management objective of keeping labour cost as low as possible is achieved by balancing productivity with wages. The object is often achieved by paying higher wages to limited satisfied workmen with high productivity. Low wage does not necessarily mean low labour cost.
You should be able to:
1. Explain Labour cost and what it involves;
2. Record Labour time and output;
3. Calculate time clocks and other methods of remuneration;
4. Distinguish between idle time, shift premium and overtime premium.
TABLE OF CONTENTS
TITLE ………………………………………………………………………………….PAGE
INTRODUCTION 1
TYPES OF LABOUR COST 1
Direct LabourCost 1
Indirect LabourCost 1
TECHNIQUES OF LABOUR COST CONTROL 1
PURPOSE OF LABOUR COST 2
ELEMENT OF LABOUR COST 2
ORGANIZATION FOR LABOUR CONTROL 2
Personnel Department 2
Engineering Department 2
Time-keeping Department 3
Payroll Department 3
Production Department 3
Cost Accounting Department 3
METHOD OF TIME RECORDING AND OUTPUT OF LABOUR COST 4
Objectives of Time-keeping 4
Methods of Time-keeping 4
COMBINED TIME AND PAY ROLL CARD 6
Requisites of a Good Time-keeping System 7
Objectives of Time-Booking 9
PAYROLL PREPARATION 9
Payroll Department Functions 10
WAGE ANALYSIS AND LABOUR 10
WAGE ANALYSIS 10
WAGES ANALYSIS BOOK 11
TREATMENT OF IDLE TIME 13
CAUSES OF IDLE TIME 14
TYPES OF IDLE COST 14
TREATMENT IN COST ACCOUNTING: 15
CONTROL 16
SHIFT PREMIUM ON LABOUR COSTING 16
Shift Differential 17
Eligibility for shift premium 17
Shift pay hours 18
TREATMENT OF OVERTIME PREMIUM 18
Overtime 18
Overtime Premium 18
ELEMENTS OF OVERTIME PAYMENT: 18
CONTROL OF OVERTIME: 19
Advantages of overtime premium 19
Disadvantages of overtime premium 19
OVERTIME CALCULATION COMPONENTS: HOW THEY WORK TOGETHER 20
1. Rates Costing Method 20
2. Extension Costing Method 20
Overtime Expenditure Types 21
Labour Costing Multipliers 21
Labour Costing Rules 22
Overtime Projects and Tasks 22
How to Calculate Employer’s Cost of Overtime 22
EFFECT OF UNIT COST 23
METHOD OF REMUNERATION 24
Illustration: 1 29
Solution: 29
Bonus or Incentives Schemes 30
Illustration: 2 31
Solution: 31
Illustration: 3 31
Solution: 31
Illustration: 4 33
Solution: 33
QUESTIONS AND ANSWERS 33
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CITE THIS WORK
(2016, 01). Labour Costing.. ProjectStoc.com. Retrieved 01, 2016, from https://projectstoc.com/read/6893/labour-costing-43
"Labour Costing." ProjectStoc.com. 01 2016. 2016. 01 2016 <https://projectstoc.com/read/6893/labour-costing-43>.
"Labour Costing.." ProjectStoc.com. ProjectStoc.com, 01 2016. Web. 01 2016. <https://projectstoc.com/read/6893/labour-costing-43>.
"Labour Costing.." ProjectStoc.com. 01, 2016. Accessed 01, 2016. https://projectstoc.com/read/6893/labour-costing-43.
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