A human resources manager is looking at the company's compensation package after hearing multiple complaints from production shift managers that employee turnover was too high. The human resource manager estimated that a total of $2,000 was being spent hiring and on-boarding each worker. A single worker generates $350 per day of work and costs $325 per day of work. If, on average, a worker stays employed at the company for 150 days, how many days beyond the break-even point (measured in days the worker is employed at the company) does a worker, on average, stay with the company?

A human resources manager is looking at the company's compensation package after hearing multiple complaints from production shift managers that employee turnover was too high. The human resource manager estimated that a total of $2,000 was being spent hiring and on-boarding each worker. A single worker generates $350 per day of work and costs $325 per day of work. If, on average, a worker stays employed at the company for 150 days, how many days beyond the break-even point (measured in days the worker is employed at the company) does a worker, on average, stay with the company?

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter3: Accounting For Labor

Section: Chapter Questions

Problem 2MC: Huron Manufacturing Co. uses a job order cost system to cost its products. It recently signed a new...

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Huron Manufacturing Co. uses a job order cost system to cost its products. It recently signed a new contract with the union that calls for time-and-a-half for all work over 40 hours a week and double-time for Saturday and Sunday. Also, a bonus of 1% of the employees earnings for the year is to be paid to the employees at the end of the fiscal year. The controller, the plant manager, and the sales manager disagree as to how the overtime pay and the bonus should be allocated. An examination of the first months payroll under the new union contract provisions shows the following: Analysis of the supporting payroll documents revealed the following: a. More production was scheduled each day than could be handled in a regular workday, resulting in the need for overtime. b. The Saturday and Sunday hours resulted from rush orders with special contract arrangements with the customers. The controller believes that the overtime premiums and the bonus should be charged to factory overhead and spread over all production of the accounting period, regardless of when the jobs were completed. The plant manager favors charging the overtime premiums directly to the jobs worked on during overtime hours and the bonus to administrative expense. The sales manager states that the overtime premiums and bonus are not factory costs chargeable to regular production but are costs created from administrative policies and, therefore, should be charged only to administrative expense. Required: 1. Evaluate each positionthe controllers, the plant managers, and the sales managers. If you disagree with all of the positions taken, present your view of the appropriate allocation. 2. Prepare the journal entries to illustrate the position you support, including the accrual for the bonus.
A foundry employee worked a normal 40-hour shift, but four hours were idle due to a small fire in the plant. The employee earns $18 per hour.Required:1. Calculate the employee’s total compensation for the week.2. How much of this compensation is a direct-labor cost? How much is overhead?
Suppose that an accounting firm with 10 employees hires another accountant. Bydoing so, it goes from serving 30 customers each week to serving 32 customerseach week. What is the marginal product of labor for the new accountant?
Butcher Enterprises has experienced substantial employee turnover among its office workers. During exit interviews, more than 80 percent stated that low pay was the top reason for resigning. The company conducted a survey of local companies' pay practices to confirm whether this concern is valid. Indeed, Butcher Enterprises' average hourly pay rate for total compensation falls well below the market. The compensation survey showed an average hourly rate of $28.00 for total compensation. Of this amount, wages are $26.00 per hour and benefits are $2 per hour. In comparison, Butcher Enterprises spends an average hourly rate of $22 for total compensation. Of this amount, 70 percent is allocated for wages. Butcher Enterprises spends $ 15.40 on wages and $ 6.60 on benefits, respectively, on an average hourly basis. Round your response to the nearest hundreths place. If we assume that each worker provides 2,080 hours of service each year, then the company will spend son wages and $ on benefits…
Butcher Enterprises has experienced substantial employee turnover among its office workers. During exit interviews, more than 80 percent stated that low pay was the top reason for resigning. The company conducted a survey of local companies’ pay practices to confirm whether this concern is valid. Indeed, Butcher Enterprises’ average hourly pay rate for total compensation falls well below the market. The compensation survey showed an average hourly rate of $23 for total compensation. Of this amount, wages are $16 per hour and benefits are $7 per hour. In comparison, Butcher Enterprises spends an average hourly rate of $19 for total compensation. Of this amount, 70 percent is allocated for wages.1-7. On an average hourly basis, how much does Butcher Enterprises spend on wages and benefits, respectively, in dollars?1-8. How much does the company spend on wages and benefits over the course of one year for 100 office workers? Assume that each worker provides 2,080 hours of service each…
I am stuck on a homework problem: A company employs two appraisers. The company expects to incur total overhead costs of $378,210 during the year and applies overhead based on annual salary costs. The salary and billable hours of the two appraisers are estimated to be as follows.... DEBBIES ANNUAL SALARY=$165,880 DEBBIES BILLABLE HOURS=2,200 TARAS ANNUAL SALARY=$86,260 TARAS BILLABLE HOURS=1900 The accountant for the company is computing the hourly rate that should be used to charge clients for Debbie's and Tara's services. The hourly billing rate should be set to cover the total cost of services (salary plus overhead) plus a 30% markup. 1.) COMPUTE THE PREDETERMINED OVERHEAD RATE 2.) COMPUTE THE HOURLY BILLING RATE FOR DEBBIE AND TARA
A worker has taken 15 hours to complete a job. It has enabled him to get bönus under both Halsey and Rowan Schemes. Since the worker is not much educated, he requested a cost accountant for necessary advice. The advisor informed him that Rowan method is better for him since it will give him extra bonus of 6.25 in comparison with the Halsey method. Hourly wage rate is 5. You are requested to ascertain standard time allowed for the job.
A&R Quality Advisors is a small consulting firm offering quality audits and advising services to small and mid-sized manufacturing firms. Quality audits entail reviewing, checking, and documenting quality practices within a firm. Quality advising entails making recommendations for new or revised quality practices. Other firms in the area offer one or both of these services, although the competition for quality audit jobs is stronger than for quality advising. In addition to senior executives, A&R employees are either staff or managers. Staff employees are usually younger with less experience. Managers, who oversee the staff on jobs, are more experienced. The average hourly wage is $60 for staff and $150 for managers. (Both staff and managers are paid an annual salary; these hourly costs are based on 2,000 average annual hours worked.) Staff are expected to spend at least 90 percent of their time on billable work. Because of administrative work associated with supervising the staff and…
At the end of the month, you find that the labor and materials spent on manufacturing collars was different from what you estimated: The collar maker had to work nine hours a day instead of eight due to an increased demand for collars. Because of the increased demand, the hourly rate you paid your employee for making the collars increased to $16.50. An increase in the cost of raw material led the direct material cost per collar to increase to $10. However, you also made and sold 60 more collars than you expected to sell in the month. You now need to determine the variance in the materials and labor cost from what you estimated in Milestone Two based on the market research data.
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