Question

The cost
structure of an article, the
selling price of which is Rs. 500 is as
follolus:
Direct Materials = 50% of the total cost
Direct labour= 30% of the total cost
Ourheads Balance =20%
Due to anticipated increase in existing
materials by 20% and in the existing
labour rate by 10% the existing profit
would come down by 30%. if the selling
price rumains unchanged prepare
a comparative statement showing
the cost, profit and selling price under
the present conditions and with the
increase expected for the future, assuming
the same percentage of profit on
under present conditions has to be earned
calculations may to made to the nearest rupees

Answer 1

Answer:

The cost

structure of an article, the

selling price of which is Rs. 500 is as

follolus:

Direct Materials = 50% of the total cost

Direct labour= 30% of the total cost

Ourheads Balance =20%

Due to anticipated increase in existing

materials by 20% and in the existing

labour rate by 10% the existing profit

would come down by 30%. if the selling

price rumains unchanged prepare

a comparative statement showing

the cost, profit and selling price under

the present conditions and with the

increase expected for the future, assuming

the same percentage of profit on

under present conditions has to be earned

calculations may to made to the nearest rupees