The following information relates to manufacturing of a component "ZIP" in a cost centre. Cost of material ₹6 per component, Operator's wages ₹7.20 per hour, Machine hour rate ₹1.50 per hour, setting up time of machine (

CS Executive · Cost and Management Accounting · PYQS · June 2019
The following information relates to manufacturing of a component "ZIP" in a cost centre. Cost of material ₹6 per component, Operator's wages ₹7.20 per hour, Machine hour rate ₹1.50 per hour, setting up time of machine (productive) 5 hours, manufacturing time 10 minutes per component. Company producing 50 batches consist of 100 components in each batch. What will be the cost per batch and total setting up cost?
(A) ₹740.87 and ₹43.50
(B) ₹745.87 and ₹43.50
(C) ₹745.72 and ₹36
(D) ₹74.57 and ₹36

Answer & Explanation:

Correct Answer: Option (B)

Official answer key: (B).

Topics: Job Costing

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