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    Organization For Labor Cost Accounting and Control

    Uploaded by

    Patrick Lance
    Labor cost accounting involves tracking: (1) individual employee time and earnings, (2) direct and indirect labor costs by department, and (3) cumulative payroll data for compliance. It relies on coordination between personnel, timekeeping, payroll, production planning, and cost accounting departments to record time worked, calculate wages, distribute labor costs, and analyze productivity. The goal is to effectively manage human resources and labor costs.

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    Organization For Labor Cost Accounting and Control

    Uploaded by

    Patrick Lance
    51 views22 pages
    Labor cost accounting involves tracking: (1) individual employee time and earnings, (2) direct and indirect labor costs by department, and (3) cumulative payroll data for compliance. It relies on coordination between personnel, timekeeping, payroll, production planning, and cost accounting departments to record time worked, calculate wages, distribute labor costs, and analyze productivity. The goal is to effectively manage human resources and labor costs.

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    Organization for Labor Cost Accounting and Control

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    Labor cost accounting involves tracking: (1) individual employee time and earnings, (2) direct and indirect labor costs by department, and (3) cumulative payroll data for compliance. It relies on coordination between personnel, timekeeping, payroll, production planning, and cost accounting departments to record time worked, calculate wages, distribute labor costs, and analyze productivity. The goal is to effectively manage human resources and labor costs.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    51 views22 pages

    Organization For Labor Cost Accounting and Control

    Uploaded by

    Patrick Lance
    Labor cost accounting involves tracking: (1) individual employee time and earnings, (2) direct and indirect labor costs by department, and (3) cumulative payroll data for compliance. It relies on coordination between personnel, timekeeping, payroll, production planning, and cost accounting departments to record time worked, calculate wages, distribute labor costs, and analyze productivity. The goal is to effectively manage human resources and labor costs.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    of 22

    ACCOUNTING

    FOR LABOR
    ORGANIZATION
    FOR LABOR COST
    ACCOUNTING
    AND CONTROL.
    Organization for Labor Cost Accounting
    and Control Labor cost accounting involves the following;

    1. The employment history of


    each worker. needed to comply with contracts,
    2. Information
    laws, taxes, state, local government requirements.
    3. Labor time and cost standards.
    Organization for Labor Cost Accounting
    and Control
    Labor cost accounting involves the following;
    4. Each employee’s time worked, wage rate, and total
    earnings for each payroll period.
    5. The computation of deductions from gross wages
    for each employee.
    6. The output or accomplishment of each employee.
    Organization for Labor Cost Accounting
    and Control
    Labor cost accounting involves the following;

    7. The amount of indirect labor cost and the direct


    labor cost
    8. Total labor cost in each department for each
    period.
    9. Cumulative data on earnings and payroll deduction
    for each employee.
    Financial Accounting Cost Accounting

    A record is kept of the A record is kept of the


    total time worked and time worked on each
    the total amount earned job, process or
    by each worker. department by each
    worker and the
    associated cost
    Financial Accounting Cost Accounting
    Dr Cr Subsidiary record Dr Cr
    Payroll XXX
    Employee XXX WIP XXX
    income tax
    FOH Control XXX
    payable

    FICA Tax XXX


    payable Indirect Labor XXX

    Accrued XXX
    payroll Payroll XXX
    Personnel Timekeeping

    Production Payroll
    Planning
    Cost Department
    •Personnel functions
    PERSONNEL include recruiting, hiring,
    training, evaluation,
    DEPARTMEN retirement counseling,
    T termination and
    outplacement
    PRODUCTION PLANNING
    DEPARTMENT
    •A production planning
    department is responsible for
    scheduling work and releasing
    work orders to the producing
    departments.
    Production Planning Department
    TIMEKEEPING DEPARTMENT

    A clock card or timecard Time tickets or job


    that provides reliable tickets to secure
    evidence of the employee’s information as to the
    presence in the plant from type and duration of
    time of entry to departure. work performed.
    Timekeeping Department

    Time Clock – the time clock or time recorder is an


    instrument that records employees’ time in and out of the
    office or factory
    A clock card provides space for the name and number of the
    employee and usually covers and entire payroll period.
    Timekeeping Department

    Time Ticket or Report- in accounting for labor, the clock


    card is evidence that time has been purchased and it is
    comparable to a receiving report.

    Time ticket Daily time report


    Timekeeping Department

    Bar-Coding Technology- computerized on-site data entry


    for both clock cards and time tickets can be achieved by
    bar coding.

    Bar codes
    PAYROLL DEPARTMENT

    1 2
    Computing and Distributing the payroll
    preparing the payroll cost to jobs and
    and departments.
    •Payroll Computation and
    Preparation- the payroll is
    prepared from clock cards.
    PAYROLL The final computed payroll
    DEPARTMEN is recorded in a payroll
    T journal or payroll record.
    The record shows total
    wages, deductions and the
    net payroll.
    •Payroll Distribution- the
    individual time ticket or daily
    time report shows the use of
    PAYROLL the time purchased from each
    DEPARTMENT employee. The tickets for
    each employee must agree
    with the employee’s total
    earnings for the last week
    COST DEPARTMENT
    •In the basis of the labor distribution
    summary or the time tickets, the cost
    department records direct labor cost
    on job cost sheets or departmental
    overhead records.
    •Labor, the human
    contribution to production,
    has a direct link to
    SUMMARY productivity. Productivity
    improvements require better
    management of human
    resources.
    Thank you!

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