[Sheraz74]

I previously followed the method given below and it went wrong…one employee is working 35+4=39 hours.
it takes him 3 hours to produce 1 unit, this means he produces 39/3=13 units in one week.
his payment in a week is: 35 x 5.5 + 4 x 7.5=222.5
therefore, cost/unit= 222.5/13=17.12

In the new system, there will be no overtime.

this means each employee will produce 13 units in 35 hours.
payment for 35 hours= 35 x 5.5=192.5
so the new cost/unit=192.5/13=14.8

the difference Old sys – new system = 17.2 – 14.8 = 2.31
so I choose *b* option but thn=anks for you help sir now it is clear to me

[Sheraz74]

Thank You very much sir for your help…I got this quiz from skans notes and its answer was not given there and I am also week in payroll topic. so to get my concept clear I asked his question.
Thanks Again

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