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An employee normally paid for 36 hours a per week. The standard rate pay per week is $3.60 per hour. A premium of 50% of the basic hour rate is paid for all overtime hour worked.
The employee worked for 42 hours. and worked the following overtime :Machine breakdown 4 hours
To a special job at the request of a customer 2 hoursHow much of the employee earnings will be treated as direct wages.
Please do not simply write out test questions and expect an answer!
You must have answers in the same book in which you found the question, and so you should ask about whatever it is in the answer that you are not clear about.
Their basic pay (excluding idle time for the machine breakdown) is 38 hours x $3.60 = $136.80. This is a direct cost.
The overtime premium for the special job is 2 hours x 50% x $3.60 = $3.60. This is also a direct cost.Therefore the total direct wages are $140.40.
The ‘rules’ are all explained in my free lectures. The lectures are a complete free course for Paper MA (F2) and cover everything needed to be able to pass the exam well.
Thanks John.
I now understand. 2 hour was added to the 36 basic hour because it was at the request of the customer.
I was confused before by the 38 hour.
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