A factory uses a job costing system. The following data are available form the books at the year ending 31
A factory uses a job costing system. The following data are available form the books at the year ending 31st March 2002.
(a). Prepare a cost sheet indicating the prime cost, works cost, production cost, cost of sales and sales value.
(b). In 200203, the factory has received an order for a number of jobs. It is estimated that the direct materials would be Rs. 12,00,000 and direct labour would cost Rs. 7,50,000. What would be the price for these jobs if the factory intends to earn the same rate of profit on sales, assuming that the selling and distribution overhead has gone up by 15%. The factory recovers factory overhead as a percentage of direct wages and administrative and selling and distribution overhead as a percentage of works cost, based on the cost rates prevalent in the previous year.
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