Question

From the following particulars compute machine hour rate. Cost of machine 11000, Scrap value 680, Repairs for the effective working life 1500, standing charges for 4 weekly period 1600. Effective working life 10000 hrs. Power used 6 units per hour at 5 paisa per unit, Hours worked in 4 weekly period 120 hrs.​

Answer 1

Answer:

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Answer 2

Concept:

Machine Hour Rate-

• A machine hour rate is the hourly cost of operating a specific machine in terms of factory overheads.
• It is calculated by dividing the machine's factory expenses for a given period by the number of hours worked by the machine during that period.

Given:

• Cost of Machine- 11000

• Scrap value = 680

• Repairs = 1500

• standing charges for 4 weekly period = 1600

• Effective working life = 10000

• Power used 6 units per hour at 5 paisa per unit,

• Hours worked in 4 weekly period 120 hrs.

Find:

Machine Hour rate

Solution:

Standing Charges-

• Hourly rate of standing charges = 1600/120 = 13.33

Machine Charges-

• Depriciation = (11000-680) / 10000 = 1.032

• Repairs and Maintenance per hour = 1500 / 10000 = 0.15

• Power Consumed per hour = 6 x 0.05 = 0.03

Machine Hour Rate = 13.33+1.032+0.15+0.03

Machine Hour Rate = 14.542

Hence, the machine hour rate is 14.542.

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