Baluja Shoe Company manufactures two types of shoes A and B. Production costs for the year ended 31st December 2008
Baluja Shoe Company manufactures two types of shoes A and B. Production costs for the year ended 31st December 2008 were as follows:
There was no work-in-progress at the beginning or at the end of the year. It is ascertained that:
(i). The cost of direct materials in type A shoes is twice as much as that in type B.
(ii). The direct wages for type B shoes were 60% of those of type A shoes.
(iii). Production overhead was the same per pair of A and B type.
(iv). Administrative overhead for each type was 150% of direct wages.
(v). Selling cost was Rs. 1.50 per pair.
(vi). Production during the year:
Type A 40,000 pairs of which 36,000 were sold.
Type B 1,20,000 pairs of which 1,00,000 were sold.
(vii). Selling price was Rs. 44 for type A and Rs. 28 per pair for type B. Prepare a statement showing cost and profit.
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