Calculate the gross wages earned by each worker for the week 3 of April 2021
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
C: CASE STUDY
HSH Sdn Bhd produces handmade shoes for children based in Melaka. There are three workers who are employed to run the production. It is the company’s policy to set the normal working hours at 8 hours a day, operating 5 days in a week. Provided below is the information gathered from the weekly time sheet for Week 3 April 2021.
|
Employees |
Weekly hours worked |
Output produced (in pairs) |
Rejected output (in pairs) |
|||||
|
Monday |
Tuesday |
Wednesday |
Thursday |
Friday |
|
|||
|
Monica |
10 |
11 |
10 |
9 |
8 |
215 |
4 |
|
|
Rachel |
11 |
10 |
9 |
11 |
11 |
227 |
3 |
|
|
Joey |
8 |
8 |
8 |
8 |
8 |
156 |
8 |
|
Monica and Rachel are skilled workers who are paid based on an hourly rate which is RM9.00 per hour. Skilled workers are entitled for overtime payment. The company decides an overtime rate of 1.5 times of the normal rate.
Meanwhile, Joey is a semi-skilled worker who is paid based on differential piecework scheme with a weekly minimum guaranteed wage of RM400. The differential piecework pay scheme is as follows:
|
Weekly Production Level |
Rate of pay |
|
1 – 50 units |
RM2.00 per pair |
|
51 – 100 units |
RM2.50 per pair |
|
101 – 150 units |
RM3.00 per pair |
|
151 and above |
RM3.50 per pair |
Required:
Calculate the gross wages earned by each worker for the week 3 of April 2021
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