Under a straight day work scheme for wage payment in a food processing plant, a
ID: 3220909 • Letter: U
Question
Under a straight day work scheme for wage payment in a food processing plant, a worker was observed to have produced 250 cases in an eight hour day. The straight rate for this worker is presently $10.00 per hour. Consider the introduction of an incentive plan based upon an engineered time standard of 30 produced minimum $10.00 delays 230 pieces during of $10.00 per hour. Under the incentive plan on a certain day a (material an eight hour period which included 1 hours idle time due to unavoidable delays (material shortages). a) What would be the production rate under the straight day work scheme? b) What would be the direct labor cost for each piece under the straight day work scheme? c) What would be the engineered time standard used with the incentive plan expressed as hours per 100 pieces? d) Find the average production per productive hour under the incentive plan e) Find the day's earnings from the productive portion of the day? What are the day's earnings due to the idle portion of the day? g) What are the total day's earnings under the incentive plan? h) What would be the unit direct labor cost under the incentive plan? i) What could the unit direct labor cost be if material shortages, and thus worker idle time, were reduced by 50% through improved production planning and control? j) Tabulate the worker efficiencies and unit costs under the day work and incentive plans with and without the production control improvements.Explanation / Answer
a) 250 cases - 8 hour day - $10 per hour.
250/8 = 31.25 pieces per hour. That makes each piece at $0.32 on a straight work day scheme. Production rate is 31.25 pieces/hr on a straight work day
b) Labor cost for each piece under straight work day is $0.32 per piece
c) For the incentive plan, 30 pieces per hour, makes it 240 pieces over a 8 hour period, but the worker produced 230 in 7 hours, which makes it 230/7 or 32.85 pieces per hour. At this rate to produce 100 pieces he would take 100/32.85 or 3.044 hours
d) Average production rate is 32.85/hour
e) 230 pieces in 7 hours. 230 * 0.32$ per piece is $73.6
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.