CA Intermediate · Cost and Management Accounting · Unit & Batch Costing
A cement tile factory in Jaipur makes a single standard product and uses unit costing. For a month, the total production cost was ₹6,48,000 and 24,000 tiles were produced. Which cost per tile will the firm report?
The cost per tile is ₹27. Unit costing applies to a single uniform product, so the total production cost of ₹6,48,000 is divided by the 24,000 tiles produced, giving ₹27 per tile.
- A₹24
- B₹27Correct
- C₹30
- D₹36
Explanation
Unit costing divides total cost by units produced: 6,48,000 / 24,000 = ₹27 per tile. ₹24 results from using a wrong total cost, and ₹30 or ₹36 have no basis in the data.
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