Accounting theory of accounting for labour for the board exam.
State two functions of engineering department.
The engineering department maintains working condition.
It also maintains production methods for each job or department.
The functions of this department are:
Write in five sentences about the need of time and motion study while fixing-up wage rate.
Write in simple five sentences illustrate the meaning of time and motion study.
Write the meaning of time and motion study.
This study is based on scientific management.
Under scientific management, standard task of every worker is determined with careful study.
Here, standard means quantity produced by an average worker under standardized condition.
Time and motion study department carefully determines a standard task for every worker.
Motion study aims to eliminate the unnecessary work.
It helps to ascertain the easiest and best method for performing a job.
The object of motion study is to improve working capacity and reducing fatigue.
This study is the art of observing and recording the time to do each job.
It helps to fix a standard time for a job.
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Write in short what do you know about payroll accounting?
The payroll department is concerned with calculation and disbursement of wages to employees.
The main function of payroll department is to prepare wage sheet.
The wage sheet contains detailed information of the gross and net income of each worker.
It has following functions:
To record the job classification, department and wage rate for each employee.
To verify and to summarize the time of each worker as shown on the daily time cards.
To compute the wages of each employee and prepare the payroll.
To compute the payroll deductions.
To maintain a permanent payroll record of each employees.
To disburse wage or salary payments etc.
What are the different kinds of frauds in wage payment?
There are more chances of fraud and manipulation in wage payment than any other transaction.
For avoiding frauds and manipulation, proper and systematic procedure should be adopted.
The following types of frauds are commonly seen:
What are the steps to be taken to minimize the frauds in wage payment?
The following steps should be taken to avoid or minimize frauds
(a) The wages of workers should be paid in the presence of supervisor or departments head so that the worker can be identified.
(b) Each worker should be provided an identity card with photograph and necessary information to identify the worker.
(c) To avoid bogus entries in the payroll, it should be verified with time keeping and book-keeping.
(d) The payroll should be certified by the person who prepared it and get it signed from manager.
(e) To avoid the fraud, the cashier should not be associated with payroll section.
(f) Pay pocket must be prepared for each worker with his name and card number but amount is not written.
What is time rate system of wage payment?
What do you understand by time rate?
State the disadvantages of time rate system of wage payment.
Mention any four advantages of time rate system.
Give two disadvantages of time wage system.
Write any two disadvantages of time wage system.
This method is also called time rate system.
Under this system, wages are paid to workers on time basis.
It is not related to output.
It may be paid on hourly, daily, weekly or monthly basis.
This system is applied where:
· Quality of work is more important than the volume
· Measure of work is indirect labour basis.
· Work demands high degree of skill.
· Production involves delay and interruption due to another factor.
The main advantages of time rate system are:
· This process is simple and easy to understand.
· It is more useful where quality products are manufactured.
· It is useful to fresher or unskilled workers because minimum wages is allowed.
· This method is favoured by trade union because workers are paid equal wage.
The main disadvantages of time rate system are:
a. Production is low because there is no relation between input and output.
b. No differences between skilled and unskilled workers that frustrated skilled workers because wage is same.
c. Labour cost per unit is difficult to set in advance.
d. Workers are paid wages for idle time; it is not good for company.
Define piece rate system of wage payment and list out any two disadvantages of it.
What are the advantages of piece rate system?
Write any four merits of piece rate system of wage payment.
Piece method is also called piece wage system.
Under this system, wages are fixed at a specific rate per unit.
Workers receive wages on the basis of their ability, energy and speed of work.
Wage rate are per meter, piece, kg, quintal, ton, square feet/meter, cubic feet/ meter etc.
The main advantages of piece rate system are:
· It is improvement of time wage system.
· Unskilled, semi-skilled and skilled labour can earn according to their capacity.
· Increase in production reduces fixed cost per unit.
· Wages for idle time is not paid in this system.
The main disadvantages of piece rate system are:
· It is difficult to fix suitable piece work rate.
· Unskilled workers will be frustrated due to fewer wages.
· It is not suitable for quality product because ‘haste makes waste.’
· Increase production will not decrease cost.
Mention three differences between time rate and piece rate.
Distinction between time rate and piece rate system of wage payment.
Write about any three differences between time wages and piece wages system of wage payment.
Time rate system
Piece rate system
Wages is based on the time worked.
Wages is based on unit produced.
Wages are not linked with the efficiency of the workers.
Wages are directly linked with the efficiency of the workers.
Supervision for quality work is not needed.
Supervision is required for quality work.
There is less chance of wastage of material.
There is a high chance of wastage of materials.
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