Rowan Premium Bonus Scheme
- An incentive scheme to reward direct labor for saving time during the production process
·
This method rewards the production
worker with a proportion of the time saved
Formula:
Proportion of time saved = Time taken/Time allowed x Time
saved
Question: compute the gross pay of
Mr A after completing the task.
Solution:
Mr A’s gross pay
= ( 8 hours x $9) + ( Time
taken/Time allowed x Time saved x Rate per hour)
= (8 hours x $9) + ( 67% x 4 hours x
$9)
= $96.12
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