Accounting for Labor
D A piece-rate plan bases an employee's earnings strictly on the number of units produced.
A wage plan based solely on an employee's quantity of production is known as a(n): a.Modified wage plan. b.Hourly-rate plan. c.Incentive wage plan. d.Piece-rate plan.
D Hourly wage plans pay a fixed rate per hour, so they are easy to apply, but they do not provide any incentive to do more than what is required, nor do they encourage employees to work so fast as to sacrifice quality
All of the following are characteristics of hourly wage plans except a.They provide no extra recognition for doing more than the minimum required. b.They are easy to apply. c.They establish a definite rate per hour for each employee. d.They encourage employees to sacrifice quality in order to maximize earnings.
A The machinist would most likely be a direct laborer. The supervisor, fork lift driver and plant janitor, while part of the manufacturing process, do not add value to the goods being produced.
All of the following personnel would be classified as indirect labor except the: a.machinist. b.supervisor. c.fork lift driver. d.plant janitor.
A An analysis of labor costs into their work in process and factory overhead components is recorded on alabor cost summary.
An analysis of total labor costs into work in process and factory overhead components is recorded on a(n): a.Labor cost summary. b.Payroll record. c.Individual production report. d.Employee earnings record
C Maintenance workers, while integral to the manufacturing process as they keep the machinery maintained, are not direct laborers because they do not actually add value to the product. Machinists, assembly workers and painters would all add value to the manufacture of a car door.
At a plant where car doors were manufactured, all of the following would be classified as direct labor except: a.Machinists. b.Assembly workers. c.Maintenance personnel. d.Painters.
A Idle time should be recorded and charged to Factory Overhead as it does not add value to any specific jobs.
Idle time should be treated as follows: a.It should be recorded along with the reason for it, and charged to Factory Overhead. b.It should be charged to the job from which the employee took a break. c.It should be documented and the employee should not be paid for that time. d.It should be allocated to the various manufacturing departments and the supervisors shoulddecide how to handle it.
A By charging the overtime premium to factory overhead, all jobs worked on during the period share the cost.
If the amount of overtime premium is to be charged to all jobs worked on during the period as a result of random scheduling of jobs, the debit will be to: a.Factory Overhead. b.Payroll. c.Work in Process. d.Accrued Payroll.
D Employers who run shifts other than day shifts often pay shift premiums for those shifts which are designed to attract workers to the less desirable shifts. Shift premiums compensate employees on the "swing" or "graveyard" shifts for the lifestyle adjustments necessary to work those shifts, even though productivity is usually not as high as that of the workers on normal day shifts.
Jay Vato works at Batwing Industries from midnight until 8:00 AM. His normal wage rate is $17 per hour, while Ben Phillips, who does the same job from 8:00 AM until 4:00 PM makes $15 per hour. Since Ben and Jay have the same seniority within the plant, the difference in pay is due to a(n): a.overtime premium. b.production bonus c.make-up guarantee. d.shift premium.
A Items (b), (c), and (d) are the responsibilities of the payroll function, whereas item (a) is the responsibility of the production supervisor.
The departmental responsibilities of the payroll function include all of the following except: a.Reviewing the labor hours on the time record for accuracy. b.Summarizing the period's payroll data. c.Keeping a record of earnings for each employee. d.Computing deductions and withholdings for each employee.
A Each factory employee's time will be summarized on a labor time record. The labor cost summary reports the total payroll distribution. The payroll record and employee's earnings record relate to the payment of payroll rather than the timekeeping function.
The file for each factory employee that shows the time the employee spent on each job, as well as timespent as indirect labor is the: a.labor time record. b.payroll record. c.employee's earnings record. d.labor cost summary.
C The employee's earnings record is a cumulative record of employee earnings needed to calculate payroll taxes. It also serves as the basis for reporting salary and wage information to government agencies.
The file that serves as a basis for reporting payroll information to governmental agencies and preparingForm W-2 is the: a.labor time record. b.payroll record. c.employee's earnings record. d.labor cost summary.
C Wage plans that encourage employees to work harder and earn more by producing a high level of output are known as:a.Modified wage plans.b.Salary wage plans.c.Piece-rate plans.d.Hourly-rate plans.
Wage plans that encourage employees to work harder and earn more by producing a high level of output are known as: a.Modified wage plans. b.Salary wage plans. c.Piece-rate plans. d.Hourly-rate plans.
D In some cases, workers' fringe benefits, including holiday pay, are charged to jobs with the workers' wages. However, many companies charge benefits to Factory Overhead as it is not cost effective to charge the benefits to jobs.
Which of the following items relating to direct labor employees might be charged to specific jobs in work in process rather than factory overhead? a.Make-up guarantee b.Idle time c.Shift premiums d.Fringe benefits