Question

A factory uses job costing. Given details obtained from its books: Direct materials – Rs.90000, Direct wages – Rs.75000, Selling OH – Rs.52500, Administration OH – Rs.42000, Factory OH – Rs.45000 & Profit – Rs. 60900. Calculate cost of production?

Answer 1

Explanation:

A factory uses job costing. Given details obtained from its books: Direct materials – Rs.90000, Direct wages – Rs.75000, Selling OH – Rs.52500, Administration OH – Rs.42000, Factory OH – Rs.45000 & Profit – Rs. 60900. Calculate cost of production?

Answer 2

Direct materials= Rs.90000

Direct wages = Rs.75000

Therefore,

primary cost= 90000+75000=165000

Now,

Factory OH = Rs.45000

That is,

Work cost= 165000+45000=21000

Administration OH = Rs.42000

Therefore,

Cost of production= 21000+42000= 252000