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Controlling Part 3

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Controlling Part 3
Controlling Part 3

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Video: Controlling Part 3
Video: Terry Controlling: Part 3 - The Raid 2023, June

Before we can determine the overhead surcharge rate and other key figures, the annual operating capacity must first be known.

The productive hours worked in the painting trade serve as a yardstick for capacity. In companies that have a digital time recording system, these hours can be determined very precisely. If time recording is not available, additional calculations are required.

The following explanations refer to a practical example with the following core workforce:

· 1 entrepreneur

· 6 journeyman

· 1 apprentice

In addition, temporary workers and unproductive temporary workers are temporarily employed.

Productive journeyman lessons

To determine the productive journeyman, the average number of employees per year must be determined. Only employees who are temporarily employed are only to be expected on a pro rata basis, whereby a value of 0.08 journeyman can be expected for a fully employed month. In addition, the average daily working time in relation to the entire employment period must be determined. Finally, you need a journeyman's average productive working days in a year. The following applies to the practical example:

· Average journeyman: 6.00 people

Daily working hours 8.0 hours / day

Average productive working days 210.0 day / year

Total hours journeyman 10,080.0 hours / year

The total hours determined by the journeyman are not always the actually productively worked time. Depending on the company organization and order structure, the following unproductive times may occur if they are remunerated as working hours:

· Material procurement and provision

· Trips to and from the construction site

· Change of construction site outside of breaks

· Training

· Meetings with customers and architects

· Site correspondence and measurements

· Reworking.

If, in our example operation, an average of 0.80 hours per day is used for these unproductive times, this corresponds to an unproductive share of 10 percent with a daily working time of 8 hours. The directly billable journeyman's hours are then as follows:

Total hours of 10,080 hours / year x 90 percent = 9,072 hours / year

Productive temporary help

The productive hours for the entrepreneur and for productive helpers are determined on the basis of records or simply estimated. These hours are added to the journeyman's hours.

Commercial apprentices work productively on the provision of services. A division into a productive and an unproductive wage component is therefore necessary. The productive share of a trainee depends on the apprenticeship year, the individual performance and the operational commitment. Compared to a skilled worker, the productive share is usually between 35 percent and 65 percent.

In the practical example it is assumed that apprentices are only available to the company on average for 30 weeks a year due to absenteeism (vocational school, inter-company training, vacation, holidays and illness). With a weekly working time of 40 hours, this results in a gross attendance time of 1,200 hours per year. If this time is multiplied by the power factor of 50 percent, this corresponds to a productive, journeyman's equivalent time of 600 hours a year.

For temporary workers, the hours worked can be found in the bills of the rental companies. Since the temporary workers are involved in the operational process, they are treated like their own journeyman. Therefore, as with the journeyman, you can expect an unproductive time (in the practical example 10 percent). If the performance is significantly lower than that of your own journeyman, this discount can be correspondingly larger. The following applies to the practical example:

· Number of total hours worked according to bills 680.0 hours / year

· Unproductive share 10.0 percent

· Directly billable hours temporary workers 612.0 hours / year

The total capacity for our example operation is now as follows:

Compilation of the directly billable hours per year:

Journeyman 9,072 h

+ Entrepreneur 300 hours

+ Apprentices 600 hours

+ Temporary worker 612 hours

= Total capacity 10,584 hours

If the total capacity is divided by the directly billable hours of a journeyman per year, you get the average productive employees:

This arithmetical value is required for comparisons of operations and periods and for the determination of numerous key figures.

Personnel costs

A division into productive and unproductive labor costs is unfortunately not always easy in practice, but the most important prerequisite for calculating the overhead rate. Only the productive wage components, i.e. the time during which the customer or the workshop actually works, can usually be settled directly. All unproductive parts can only be “hidden” in the overhead rate.

Because the bookkeeping usually does not meet the requirements of cost accounting, additional calculations and evaluations have to be carried out.

In a first step, the wages and salary account must be adjusted for all values that do not affect the journeyman. Frequently, wages and salaries for the following employees and facts are posted to this account:

· Temporary workers

· Salaries, technical

· Salaries, commercial

· Commercial apprentices

· Commercial apprentices

· Executive salaries

· Spouse's salary

· Royalties for managers and senior executives

· Remuneration to employed co-entrepreneurs

· Temporary wages, productive

· Temporary wages, unproductive

After deducting all non-journeyman's wage and salary components, the journeyman's gross wages are calculated. This also still contains unproductive components, provided there are no separate accounts for this. The following are considered unproductive personnel costs for industrial workers in the skilled trades:

· Continued payment of wages in the event of illness

· Continued payment of wages on public holidays

· Vacation wages paid including additional vacation pay

Annual special remuneration (so-called Christmas bonus)

· Asset-effective services (AG share)

Statutory social expenses (AG share)

· Payments to the compensation office less reimbursements for continued sick pay

· Dues for professional organizations

· Compensation levy for the severely disabled

· Voluntary social expenses

· Holiday fund contributions less reimbursements

· Pension expenses

· Income tax, flat rate for low earners

In the next part, we show how the overhead rate is calculated from the income statement.

Author: Eberhard Schilling, Academy for Operations Management and Master School in Stuttgart

Source: Malerblatt 02/2012

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