CA Intermediate · Cost and Management Accounting · Employee Cost and Direct Expenses
A worker at Kaveri Engineering has a standard time of 50 hours for a job and completes it in 40 hours. The time rate is ₹120 per hour. Under the Halsey premium plan with 50% share of time saved to the worker, what are the total wages for the job?
Total wages are ₹5,400. Time taken wages are 40 hours at ₹120, that is ₹4,800, and the Halsey bonus is half of the 10 hours saved at ₹120, that is ₹600. Adding the two gives ₹5,400.
- A₹4,800
- B₹5,400Correct
- C₹5,000
- D₹6,000
Explanation
Time saved = 50 - 40 = 10 hours. Bonus = 50% × 10 × 120 = ₹600. Wages for time taken = 40 × 120 = ₹4,800. Total = 4,800 + 600 = ₹5,400. Option ₹4,800 ignores the bonus; ₹6,000 pays on standard hours (50 × 120) without any sharing.
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