Night shift allowance

Workers in the factories, which operate during night
time are paid some extra amount known as ‘night shift allowance’. This extra amount is
generally incurred due to the general pressure of work beyond normal capacity level and
is treated as production overhead and recovered as such.
If this allowance is treated as part of direct wages, the jobs/production carried at night will
be costlier than jobs/production performed during the day. However, if additional
expenditure on night shift is incurred to meet some specific customer order, such
expenditure may be charged directly to the order concerned. If night shifts are run due to
abnormal circumstances, the additional expenditure should be charged to the costing
profit and loss account.