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    Problem 1 1. Separation Method

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    AJ Ortega
    The document contains several payroll and labor cost problems. Problem 1 calculates labor turnover using three different methods: separation, replacement, and flux. The separation method results in a 20% turnover, replacement is 5%, and flux is 25%. Problem 2 shows journal entries for piece rate work and calculates direct labor and minimum pay amounts. Problem 3 includes entries for payroll distribution and employer contributions. Problem 4 breaks down vacation, bonus, and holiday pay calculations. Problem 5 calculates overtime hours and the breakdown of overhead labor costs including shift and overtime premiums.

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    Problem 1 1. Separation Method

    Uploaded by

    AJ Ortega
    51 views4 pages
    The document contains several payroll and labor cost problems. Problem 1 calculates labor turnover using three different methods: separation, replacement, and flux. The separation method results in a 20% turnover, replacement is 5%, and flux is 25%. Problem 2 shows journal entries for piece rate work and calculates direct labor and minimum pay amounts. Problem 3 includes entries for payroll distribution and employer contributions. Problem 4 breaks down vacation, bonus, and holiday pay calculations. Problem 5 calculates overtime hours and the breakdown of overhead labor costs including shift and overtime premiums.

    Original Description:

    Cost Accounting

    Original Title

    Activity 3

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    The document contains several payroll and labor cost problems. Problem 1 calculates labor turnover using three different methods: separation, replacement, and flux. The separation method results in a 20% turnover, replacement is 5%, and flux is 25%. Problem 2 shows journal entries for piece rate work and calculates direct labor and minimum pay amounts. Problem 3 includes entries for payroll distribution and employer contributions. Problem 4 breaks down vacation, bonus, and holiday pay calculations. Problem 5 calculates overtime hours and the breakdown of overhead labor costs including shift and overtime premiums.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    51 views4 pages

    Problem 1 1. Separation Method

    Uploaded by

    AJ Ortega
    The document contains several payroll and labor cost problems. Problem 1 calculates labor turnover using three different methods: separation, replacement, and flux. The separation method results in a 20% turnover, replacement is 5%, and flux is 25%. Problem 2 shows journal entries for piece rate work and calculates direct labor and minimum pay amounts. Problem 3 includes entries for payroll distribution and employer contributions. Problem 4 breaks down vacation, bonus, and holiday pay calculations. Problem 5 calculates overtime hours and the breakdown of overhead labor costs including shift and overtime premiums.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 4

    Problem 1

    Average Number of workers During 2019 = 1050+950/2 =   1000  


    1. Separation Method                        
                          
       Total Employees Left During the Year    =   250    
       Replaced on Management Decision       =   50      
       Employees Separated without replacement   =250-50 = 200      
                              
    Labor Turnover = No. of workers  separated  during  a  period / Average  number  of  workers  x 100                  

                       =(200 /1000)*100      


                        20%  
    2. Replacement Method                         
    Labor Turnover = No. of workers replaced during a period / Average number of workers x 100                          
                       =(50 /1000)*100      
                        5%  
    3. Flux Method                          
    Labor Turnover = (No. of workers separated in a period + No. of workers replaced in the same period) /
    Average number of workers x 100
                       =((2oo+50) /1000)*100      
                        25%  

    Problem 2
    Piece Rate – 11.25
    Minimum- 875
    Employe # hours Direct Minimu Amou
    es worked labor m nt paid
    Krista 67 753.75 875 875 Journal Entries:
    Jose 78 877.50 875 877.50 Work in Process Inventory 5107.50
    Sophiya 80 900 875 900
    Crisia 82 922.50 875 922.50 Factory Overhead 217.50
    Maye 72 810 875 875 Cash 5,325
    Angelo 75 843.75 875 875
    5,107.5 Problem 3
    Total 0 5,325 1. Payroll 50,000
    Direct 5,107.5
    Labor   0 Withholding tax on compensation 6,304
    Factory
    Overhe SSS Contribution 800
    ad   217.50
    PhilHealth contributions 550
    HDMF contributions 100
    Accrued payroll 42,246
    Accrued Payroll 42,246
    Cash 42,246
    Work in Process 50,000
    Payroll 50,000
    To record the distribution payroll
    2. Accruals of employer’s contribution
    Factory Overhead 2,280
    SSS Contribution 1,600
    PhilHealth contributions 550
    HDMF contributions 100
    EC contribution 30
    To record employer’s contribution

    Problem 4
    1. Vacation Pay

    Vacation pay

    Weekly payroll 144,000


    Multiply: # vacation weeks 4
    Total vacation pay 576,000
    divide: # working weeks 48
    Weekly vacation pay 12,000

    2. Bonus Pay

    Bonus Pay

    Total # weeks /year 52


    Less: Vacation weeks 4
    # working weeks 48
    Total bonus 592,560
    divide: # working weeks 48
    weekly bonus pay 12,345

    3. Holiday Pay

    Holiday pay

    Weekly payroll 144,000


    Multiply: # holidays (in weeks) 2
    total holiday pay 288,000
    Divide: # working weeks 48
    Weekly holiday pay 6,000

    Problem 5
    Calculation of overtime hours:
    Overtime hours= total hours worked – total regular hours worked
    = 32,000 – 27,000
    = 5,000

    1. Total Labor Cost charged to direct labor = 27,000 x 12


    = P 324,000
    2. Total Labor Cost charged to overhead = 435,600 – 324,000
    = 111,600
    3. Breakdown of overhead cost:
    a. Second Shift Premiums

    Shift premium (8%)


    # hours in late shift 9000
    x premium .96
    Shift premium 8,640

    b. Third Shift Premiums

    Shift premium (12%)


    # hours in late shift 9000
    x premium 1.44
    Shift premium 12,960
    c. Overtime Premiums

    Overtime premium (50%)


    # overtime hours 5000
    x premium 6
    Overtime premium 30,000

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