CA Intermediate · Cost and Management Accounting · Unit & Batch Costing
Mehta Printers uses batch costing. For a batch of 400 brochures, total cost is Rs 48,000, and the firm prices at a profit of 25% on selling price. The selling price per brochure is:
Cost per brochure is Rs 120. Since profit is 25% of selling price, cost is 75% of price, so the selling price is Rs 120 divided by 0.75, which is Rs 160.
- ARs 150
- BRs 160Correct
- CRs 120
- DRs 144
Explanation
Cost per unit = 48,000/400 = Rs 120. Profit is 25% on selling price, so cost is 75% of price. Price = 120/0.75 = Rs 160. Adding 25% on cost gives Rs 150, which is the wrong base.
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