Answer to Question #327901 in Accounting for MHK

Question

Following information has been extracted from costing record of Abdul Engineering works in respect of Job No. 101.

Material Rs.5,800

Wages:

Department A 100 hours @ Rs. 5 per hour

Department B 200 hours @ Rs. 3 per hour

Overhead for the two department are estimated as follows:

Variable Overhead

Department A Rs.10,000 for 5,000 direct labour hours

Department B Rs.30,000 for 10,000 direct labour hours

Fixed Overheads: Estimated at Rs.50,000 for 50,000 normal working hours.

Required:

Calculate the cost of Job No. 101 and calculate the price to be charged so as to given a profit of 20% on selling price.

Answer 1

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