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Labour costing

Guys ..in this question they have given that work of holiday and Sunday will be paid double...but in answer they took single rate only..can anyone clarify. And how they calculated overtime allowance? Question and answer attached.

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Vishwanath Tadur

Vishwanath Tadur

CA Inter

2K+

16-Mar-21 16:45

28

Answers (3)

The computation of Basic salary already includes the pay for Sunday and 15th August as it is for 26 days [Rs.1,000 x 26]. And additionally we are paying the basic pay for those 2 days again [Rs.1000 x 2]. So, it is nothing but we are making a payment at double rate.


Madhuri Veluri

Madhuri Veluri

Moderator

17-Mar-21 17:47

Got it..thank you mam... How they calculated overtime allowance


Vishwanath Tadur

Vishwanath Tadur

CA Inter

2K+

17-Mar-21 18:06

Got it..thank you mam... How they calculated overtime allowance

On 5th and 13th Aug he worked for 10 and 9 hours. If we exclude the half an hour of lunch break, it will be 9.5 and 8.5 hours. It is said that if the worker works for atleast 9 hours then we count the overtime after the 8th hour. So here the overtime will be 2 hours [(9.5-8)+(8.5-8)]. Now overtime will be Rs.1,000 basic pay per day + Rs.200 overtime per day = Rs.1,200 per day. This should be divided by the normal hours worked to get the hourly wage rate of the worker. So, it will be Rs.1,200/7.5 = Rs.160 per hour. Total overtime allowance = Rs.160 per hour x 2 hours overtime x 2 (twice the pay as given in question) = Rs.640.


Madhuri Veluri

Madhuri Veluri

Moderator

18-Mar-21 10:07

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