Question 3 During audit of account of the G Ltd., your assistant found errors in the calculation of the wages of factory workers and he wants you to verify his work. He has extracted the following information: (i) The contract provides that the minimum wage for a worker is his base rate. It is also paid for downtimes i.e.; the machine is under repair or the worker is without work. The standard work week is 40 hours. For overtime production, workers are paid 150 percent of base rates. (ii) Straight Piece Work - The worker is paid at the rate of 20 per piece. (iii) Percentage Bonus Plan - Standard quantities of production per hour are established by the engineering department. The workers' average hourly production, determined from his total hours worked and his production is divided by the standard quantity of production to determine his efficiency ratio. The efficiency ratio is then applied to his base rate to determine his hourly earnings for the period. (iv) Emerson Efficiency Plan - A minimum wages is paid for production upto 66-2/3% of standard output or efficiency. When the workers production exceeds66-2/3% of the standard output, he is paid bonus as per the following table: Efficiency Level Bonus Upto 662/3 % Nil 662/3 % to 79 % 10% 80% - 99% 20% 100% - 125% 45% Your assistant has produced the schedule pertaining to certain workers of a weekly pay roll: Worker Total Wages incentive plan Downtime Units Standard Base hours produced units Rate hours Gross wages as per book 8,500 Rajesh Straight 40 5 400 180 piece work 455 Mohan* Straight 46 180 9,500 piece work John Straight 44 425 180 8,500 piece work Harish. Percentage 40 4 250 200 220 12.000 bonus plan Mahesh Emerson's 40 240 300 210 9.300 Anil Emerson's 40 600 500 200 12 600 * Total hours of Mohan include 6 overtime hours. Prepare a schedule showing whether the above computation of workers wages is correct on not. Give details. Calculation of correct figure of minimum wages, gross wages and wages to be paid