Question:

Bolan Engineering limited produces Camp shaft for Millat Tractors limited. The standard production is 40 units per hour with a Base wage of Rs. 300 per hour for the payment of wages to their workers for their Camp shaft plant. The company employs 5 workers in Camp shaft plant.

Each worker worked 25 days @8 hours per day in the month of March, 2020.

The each worker produced the following actual production during the month of March, 2020:

Name of workers Actual Outputs

of each worker "Units"

MuhammadHassan 8,800

Muhammad Tayab 8,600

Zafar Junaid 9,000

Muhammad Ayuab 8,000

Marium khalid 7,500

Required:

i). A schedule showing total labor cost for each worker, labor cost per unit for each worker, and total labor cost for Camp shaft Plant in the month of March, 2020 , if Company uses 80% Time saved., i.e., 80% Bonus Plan.

ii).From the three popular methods of labor remunerations. i.e., time rate system, pieces rate system and incentive schemes, which system would you recommend to management of Bolan engineering limited as a Cost and Management accountant? Give in support of recommended system with proper justifications and advantages to management.

Note: kindly show solution step by step