Question

The goes on increasing with the increase in degree of maintenance efforts.
(A) Cost of down time
(B) Cost of spares and maintenance
(C) Labour and Overhead Cost
(D) All of these​

Answer 1

Answer:

cost of spares and maintenance

Answer 2

The correct answer is option (C) Labour and Overhead Cost.

Explanation:

• The Labour and Overhead Cost goes on increasing with the increase in degree of maintenance efforts.
• The total maintenance cost for equipment is referred as the sum of the losses due to breakdowns, the cost of materials and spare parts used and the downtime costs.
• It is justified that as the degree of maintenance increases, the losses tend to increase.
• All costs on the income statement except for direct labor, direct materials, and direct expenses are referred as Overhead expenses.
• Hence, the correct answer is option C i.e Labour and Overhead Cost.