ll OMANTEL5:26 PMO 18% IDone Cost Class Activity Section 02 Dr.Amol...Q.1 Chairs Limited commenced business on 1 January 2018. Itmanufactures a special type of chair designed to alleviate backpain. Information on the first year's trading is as follows:number of chairs manufactured 5,000 and number of chairs sold4,500 selling price OMR 170 per chair, direct materials OMR 40per chair, direct labour OMR 60 per chair, fixed productionoverheads OMR 225,000. The directors ask for your help inproducing profit statements using the marginal costing andabsorption costing methods. They say that they will use 'the onethat shows the higher profit' to the company's bank manager.Q.2 Atlas Cycle Manufacturing Company furnished thefollowing information of the total expenditure incurred in themonth material used OMR 45,500; Wages paid for the laboursOMR 42,400 for the hours worked 25,000. The machine is inoperation for 35,000 hours in which 5,000 hours was lost due torepairs and maintenance and Total overhead cost OMR 33,000.Rent paid OMR 5000, Interest received OMR 2,000. An orderhas been executed to manufacture and deliver the 20 cycles forwhich materials to be used for OMR 8,000. In order toaccomplish the work labour were paid OMR 11,250 for 2,600hours and machine has been used for 2,400 hours. You arerequired to calculate the overhead chargeable to manufacture 20cycle on order by the following methods.a. Percentage of direct material costb. Percentage of labor hour costc. Percentage of Prime costd. Direct labor hour ratee. Machine hour rate!!

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Q.1 Chairs Limited commenced business on 1 January 2018. It manufactures a special type of chair designed to alleviate back pain. Information on the first year's trading is as follows: number of chairs manufactured 5,000 and number of chairs sold 4,500 selling price OMR 170 per chair, direct materials OMR 40 per chair, direct labour OMR 60 per chair, fixed production overheads OMR 225,000. The directors ask for your help in producing profit statements using the marginal costing and absorption costing methods. They say that they will use 'the one that shows the higher profitť to the company’s bank manager.

Q.1 Chairs Limited commenced business on 1 January 2018. It manufactures a special type of chair designed to alleviate back pain. Information on the first year's trading is as follows: number of chairs manufactured 5,000 and number of chairs sold 4,500 selling price OMR 170 per chair, direct materials OMR 40 per chair, direct labour OMR 60 per chair, fixed production overheads OMR 225,000. The directors ask for your help in producing profit statements using the marginal costing and absorption costing methods. They say that they will use 'the one that shows the higher profitť to the company’s bank manager.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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