How to distribute Overtime Labor cost of Exempt employees – Story of a joint family

A Prelude, but not a Pre-requisite to this blog is
Why reporting OT hours is important – A Lesson I learnt from my mom

Introduction

Joint families? Extended families living under the same roof with an ecosystem in which everyone supports one another. There are differences among members, but the common goal is the success of the whole family. In one such joint family (furniture builders since generations) there lived 4 brothers.  Their parents (Exec Management) live in the same house and are responsible for keeping the family tied together.

 Bro 1 Manages day to day affairs of the house like Finances, making sure all kids are taken care of, buying household supplies, etc. Overhead & Admin
 Bro 2 Goes out and finds people who are in need of furniture in their homes and convinces them to buy furniture from their 4th brother Sales and Proposals
 Bro 3 Builds and maintains the house like building new rooms, or furniture, etc. as the family keeps growing with more kids. Sometimes, he invents new type of furniture, which the Bro 4 can later mass produce and sell. Capital Cost
 Bro 4 Builds and ships the furniture. He also collects cash from his customers after he ensures the customers are happy with the product. Operations / Cost of Goods Sold

All the children (employees) of the house work for typically one of the brothers and are compensated with a fixed weekly allowance (exempt employees!!). There are a few children, though, who work for multiple brothers on a regular basis or a brother is helping another brother by lending one of his children.

The Story

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