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Labor Costing
Direct Labour Cost per hour Employee Working hrs Salary per Payment for per month month time in production A( Skilled Tailor) 208 B( Skilled Tailor) 208 C( semi-Skilled Tailor)208 D(Folding,Pressing) 208 3100.00 3100.00 2500.00 2900.00 3100.00 3100.00 2500.00 2900.00
Labor Cost
Direct labor
Any work that alters the composition,condition,conformation or construction of a product Any operation that advances a product towards its ultimate condition for sale thereby adding to its value
Piece Rates
Often difficult to set Involve work study techniques to measure time taken to perform an operation. Problems associated with Piece rate systems
Labor Costing-Budgeted
Basis for labor costing is time. Labor costs-Direct & Indirect need to be budgeted for a firm to examine its financial commitments & evaluate its capacity to produce a product. Total DLC=No.Of Operators*hours /week* weeks/year*avg hourly earnings. This rep the firms financial commitment to employing a pre determined no.of operators for specific time period.
Spreading Costs
Type of Fabric spread Length of spread Consistency of fabric Spreaders attention to fabric defects Complexity of spread
Cutting Costs
Pattern Configuration Die cutting requirements Fabric type Fabric design Spread Height
Assembly/Bundling
Amount of SKUs involved Bundle integration Bundling specifications required
Sewing Operations
Size of sewing bundles Size and color variations Variations in fabrics Utilization of Equipment Quality Specifications
Dis-advantages
Workers work at their own free will Slow workers are not able to earn as much Mfger might not find the best workers specially during season To earn more workers might produce inferior quality Every time a mfger hires, there needs to be price negotiation. Operators not responsible for upkeep of machines and equipments elaborate records need to be kept of pcs produced.
Section 59-Where a worker works in a factory for more than nine hours a day or for more than 48 hours a week, he shall in respect of overtime work be entitled to wages at the rate of twice his ordinary rates of wages Workers in a factory who are paid on piece rate basis, the time rate shall be deemed equivalent to the daily average of their full time earnings for the days on which they actually worked on the same or identical job during the month immediately preceding the calendar month during which the overtime work was done.