CA Intermediate · Cost and Management Accounting · Job Costing
Gupta Metals' Job G-12 has direct materials ₹30,000, direct labour ₹18,000 (900 hours at ₹20) and factory overheads absorbed on labour hours at ₹15 per hour. Material worth ₹2,000 was returned to stores as surplus from the job. What is the factory cost of the job?
The factory cost is ₹59,500. Materials returned to stores reduce the job's material cost to ₹28,000. Adding labour of ₹18,000 and overheads of 900 hours at ₹15, which is ₹13,500, gives ₹59,500.
- A₹59,500Correct
- B₹61,500
- C₹45,000
- D₹63,500
Explanation
Net materials = 30,000 − 2,000 = 28,000. Labour = 18,000. Overheads = 900 × 15 = 13,500. Factory cost = 28,000 + 18,000 + 13,500 = 59,500. Option ₹61,500 ignores the return.
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