ZED Ltd is working by employing 50 skilled workers. It is considering the introduction of incentive scheme either Halsey scheme (with 50 per cent bonus) or Rowan scheme of wage payment for increasing...

ZED Ltd is working by employing 50 skilled workers. It is considering the introduction of incentive scheme either Halsey scheme (with 50 per cent bonus) or Rowan scheme of wage payment for increasing the labour productivity to cope up the increasing demand for the product by 40 per cent. It is believed that proposed incentive scheme could bring about an average 20 per cent increase over the present earnings of the workers; it could act as sufficient incentive for them to produce more.

            Because of assurance, the increase in productivity has been observed as revealed by the figures for the month of April, 2004.

Required: (i) Calculate the effective rate of earnings under the Halsey scheme and the Rowan scheme. (ii) Calculate the savings to the ZED Ltd in terms of direct labour cost per piece. (iii) Advise ZED Ltd about the selection of the scheme to fulfill their assurance.