Q184
Direct material Rs 25,000 and wages Rs 15,000 and direct expenses Rs 5,000 What would be the factory cost if factory overhead rate is 20%.
A.
Rs. 45,000
B.
Rs. 50,000
C.
Rs. 54,000
AnswerD.
Rs. 60,000
Answer: Option C
Solution
Answer: Option C
Solution:
Calculation of factory cost = (Direct material + Wages + Direct expenses) + Factory overhead rate = (25000 + 15000 + 5000) + 20%
= 45000 + (20/100 × 45000)
= 45000 + 9000 = Rs. 54000.