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The question I am having an issue with from the lecture notes is as follows:
An organisation operates a piecework system of remuneration, but also guarantees its employees 80% of a time-based rate of pay which is based on $20 per hour for an eight hour working day. Three minutes is the standard time allowed per unit of output. Piecework is paid at the rate of $18 per standard hour.
If an employee produces 200 units in eight hours on a particular day, what is the employee’s gross pay for that day?
A $128
B $144
C $160
D $180I have read through the question and attempted it but I got answers that weren’t even available to be picked. I then read the answer at the back but I don’t understand how you got t this conclusion and the method/approach to calculate this question.
I would appreciate any help you can give so that I can understand this question better 🙂
Many thanks!The guaranteed pay means that the minimum they will be paid is 8 hours x 80% x $20 = $128.
If the piecework pay is higher than $128 then they will be paid the piecework rate. If it is lower then they will be paid $128 (because this has been guaranteed as a minimum).
The piecework rate comes to: 200 units x 3/60 hours per unit x $18 per hour = $180.
Since this is higher than the guaranteed 128, they will be paid $180.
Thank you so much for your quick and speedy response!
You have explained it really simply, allowing me to realise how much I didn’t understand what the question was asking.
I have a couple more questions:
1) Why must we use 3/60 in the second calculation?
2) Is this a common question and if so is there are general method for answering this type of question in the exam?Many thanks!
It is 3/60 because the time for each unit is 3 minutes and there are 60 minutes in an hour.
So….the time for each unit is 3/60 hours.It is not the sort of question that I would expect to be asked very often 🙂
I see…thanks so much for taking the time to respond to my questions and explain this to me, I really appreciate it 🙂
Glad to know that it’s not a common question but hopefully I will be able to battle this kind of question if it comes up!
Many thanks!
A piecework system works as follow:
$3.2 per unit for up to 40 units per week
$3.5 per unit for 41 units to 50 units per week
$3.8 per units for each unit over 50 units per weekThere is a guaranteed weekly wage of $120 per week
One employee has produced the following amounts for the last 2 weeks
Week 1 35 units
Week 2 44 unitsREQUIRED:
What is the employees gross wage for week 1 and 2?There is no point in simply posting full question and expecting a full answer.
Unless it has been given you as a test question, you must have an answer in the same book in which you have found the question. Ask about whatever it is in the answer that you are not clear about and then I will explain.
(If it is a test question, then sorry but we do not provide answers to test questions 🙂 )
I understand the question perfectly. However since you must have an answer in the same book in which you found the question, you should ask about whatever it is in the answer that you are not clear about.
We do not simply provide full answers to full questions 🙂I assume that you have watched the free lectures on labour?
Sir in the first question, where it says 80% time based would be guaranteed, but i wanted to know if the rest 20% aren’t we going to use that % to calculate piecework, like it says standard time is 10 hrs and he’s working 8, i understood you multiplied standard hours with units but are we not going to use that 20%, please could you explain me that
Read again my reply to the first question.
All they are doing is guaranteeing a minimum amount of pay for the day.
Yes sir i read it and i know guarenteed minimum wage, since piecework is offered on number of units produced, so if that would be high we would use piece work rate, but i wanted to know that 80% is for time based pay, but the rest 20% what about that?
What about it?
The guarantee is that they must be paid at least $128, and that is all that is relevant.
Yes sir i got that guarentee is they must be paid $128, but that guarentee is only 80% would be paid from time based not 100% because the rest 20% is of piecework on units produced, so I’m curious are we not going to use that rest 20% because that is not guarenteed
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