An operator engaged in operations of certain machine receives an ordinary day wages of 160 per day of 8 hours. The standard output for the operation has been fixed at 80 units per hour (time as fixed for premium bonus). On a certain day, the output of the worker on this machine is 800 units. Find the Labour Cost per 100 units and the Wages that should have been actually earned by the operator if Halsey Premium System is being adopted.
Answers
Labour Cost per 100 units is 22.50
GIVEN: Wage of an operator for a day= 160, Total hour worked by a operator = 8, Standard output = 80 units per hour
TO FIND: Labor cost per 100 units
SOLUTION:
Standard output per hour = 80 pieces
Standard output per day or for 8 hours = 80 x 8 = 640 pieces
Actual production in a day or eight hours is 800 pieces.
160 pieces are added to the output (800 - 640).
Bonus
For 100 extra outputs, the bonus is = $19.00
The bonus is 19.100 for each additional output.
For 160 extra outputs, bonus is = (19 / 100) x 160 = 30.40
Regular wages for 8 hours = 160.00
+ Bonus = 30.40
Total wages = 190.40
Per 100 Piece Wages
For 800 pieces wages = 190.40
For 1-piece wages = 190.40/800
For 100 pieces wages = (190.40 / 800) x 100 = 23.80
2. Straight Piece of Rate
Per piece wages = 160 / 640 = 0.25
For 800 pieces wages = 800 x 0.25 = 200
Per 100 pieces wages = (200 / 800) x 100 = 25
3. Halsey Premium Bonus System
8 hours is the standard time for 640 pieces.
For one piece, the standard time is 8/640 hours.
The standard time for 800 pieces is 10 hours (8 x 800).
Time required: 8 hours.
10 - 8 = 2 hours saved or additional time.
The formula for Halsey Premium Scheme
Time saved at 50% = 2 x (50 / 100) = 1 hour.
Normal pay is 160.00.
Bonus: (20) (1 x 160) / 8
Earnings total = 160 + 20 = 180.
Earnings per 100 pieces: (180 / 800) x 100 = 22.50.
Labour Cost per 100 units is 22.50.
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