Max Madina limited Workshop is a factory dealing solely in repairs caused by accident within the Madina –Legon road. It has three departments through which all the vehicles pass:  Mechanical workshop, Electrical shop and spraying shop. Information obtains from their cost records shows the following for the last quarter ending 31st December 2016.     Wage rate Variable Overheads Direct Labour   GH¢ GH¢ HRS MECHAINCAL  SHOP 0.66 10,000 10,000 ELECTRICAL SHOP 0.50   9,000 12,000 SPRAYING SHOP 0.50   2,000   5,000         You are to repair and maintain the vehicles for a profit 20% of the price quoted. Fixed factory overheads are estimated at Ghc 5,400.Information relating to the repairs and maintenance of vehicles No AZ 2020 -16   Direct labour hours Cost GHC Material from store   500 Components to be bought   120 Mechanical shop            50   Electrical shop            60   Spraying  shop            40   Washing for a road test     20    Administration cost will be absorbed by adding 10% to the cost already given above You are required to prepare a detailed estimate for the cost of repairs of the vehicle no. AZ 2020 16

FINANCIAL ACCOUNTING
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ISBN:9781259964947
Author:Libby
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Chapter1: Financial Statements And Business Decisions
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Max Madina limited Workshop is a factory dealing solely in repairs caused by accident within the Madina –Legon road. It has three departments through which all the vehicles pass:  Mechanical workshop, Electrical shop and spraying shop.

Information obtains from their cost records shows the following for the last quarter ending 31st December 2016.

 

 

Wage rate

Variable Overheads

Direct Labour

 

GH¢

GH¢

HRS

MECHAINCAL  SHOP

0.66

10,000

10,000

ELECTRICAL SHOP

0.50

  9,000

12,000

SPRAYING SHOP

0.50

  2,000

  5,000

 

 

 

 

You are to repair and maintain the vehicles for a profit 20% of the price quoted.

Fixed factory overheads are estimated at Ghc 5,400.Information relating to the repairs and maintenance of vehicles No AZ 2020 -16

 

Direct labour hours

Cost GHC

Material from store

 

500

Components to be bought

 

120

Mechanical shop

           50

 

Electrical shop

           60

 

Spraying  shop

           40

 

Washing for a road test

 

  20

 

 Administration cost will be absorbed by adding 10% to the cost already given above

You are required to prepare a detailed estimate for the cost of repairs of the vehicle no. AZ 2020 16

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