Chapter07 Labour costs劳动成本（(含答案)）.docVIP

PAGE42 / NUMPAGES42 Chapter07 Labor costs Priority = High Exam Guidance You will be expected to illustrate different remuneration policy and incentive schemes. Their characteristics must be always in your mind. And you must be familiar with the computation of total pay of employee. You will also need to be aware of the procedures and documents required for recording labour costs. 1. Measuring labour activity 1.1 Corresponding concepts 1.1.1 Production is the quantity or volume of output produced. 1.1.2 Productivity is a measure of the efficiency with which output has been produced. It is also called efficiency ratio. Productivity/ Productivity/ efficiency ratio = Expected hours Actual hours = Actual output Expected output Ratio 100% : efficient labour Ratio 100%: inefficient labour Example: Suppose that an employee is expected to produce 3 units in every hour that he works. The standard rate of productivity is 3 units per hour. If, during one week, the employee makes 126 units in 40 hours of work the following comments can be made. 1.1.3 Standard hour of production is a concept used in standard costing, and means the number of units that can be produced by one worker working in the standard way at the standard rate for one hour. Standard hour of production Standard hour of production = Budgeted output Budgeted hours 1.1.4 Production volume ratio Production volume ratio Production volume ratio = Expected hours to make output Budgeted hours = Output measured in expected or standard hours Budgeted hours = Actual output Budgeted output Ratio 100%: worked above capacity Ratio 100%: worked below capacity 1.1.5 Capacity ratio represents how much production capacity is utilized. Capacity ratio Capacity ratio = Actual hours taken Budgeted hours Relationship between the three ratios Production volume ratio = Efficiency ratio X capacity ratio Example: Rush and Fluster Co budgets to make 25,000 standard units of output(in four hours each) during a budget period of 100,00