Question

ABC has employees 300 workers as a team. Standard production of 800 pieces per hour. Each employee in the team is paid a bonus for the excess production in addition to wages at hourly rates.

The bonus= % of production more than the standard quantity is found. Five % is regarded as the employees share. The employee in the team is paid as a bonus this percentage of a wage  rate of $30 per hours.

Total hours worked=     2100                            

Total Production=2700000

During the week Paul worked 40 hours and was paid $20 per hour. Margaret also worked 40 hours and was paid $20.

Calculate

     The bonus rate for the week                               

     Total bonus for the Team                                   

     Total pay for Paul and Margaret.                               

 

              

 

Answer 1

Standard production for actual hours worked:

= Actual hours worked $\times$ Standard production per hour

= 2,100 $\times$ 1,000

= 2,100,000

Excess production:

= Actual production - Standard production

= 2,700,000 - 2,100,000

= 600,000

Computing percentage of excess production over standard:

$= \frac{600,000}{ 2,100,000}$

$= 0.2857$

Computing each employee's share of bonus:

= Percentage of excess production $\times 5\%$

= $28.57\%\times5\%$

= $0.1428$

Computing bonus rate:

= Hourly wage rate $\times$ Men's share

=$\$30 \times 0.1428$

= $\$4.284$ per hour

Computing total amount of bonus for the week:

=$2,100 \times \$4.284$

=$\$8,996.4$

 

Computing total pay for Paul and Margaret:

Bonus rate for the week =$\$4.284$ per hour

Total bonus for the team = $\$8,996.4$ nearly $\$9,000$

Total pay for:

Paul = $\$971.36$

Margaret =$\$971.36$