q15 Wages Here profit is 20% on Sales or 25% on Total Cost. Now Increased Cost of Production Materials 30% + 30% of it = 39 20% + 25% of it 25 Rent & Rates etc. 5% + 20% of it 06 Fuel 10% + 50% of it = 15 Gen. Exps. 15% 15 Total Cost 100 Profit 25 Selling Price 125 In order to obtain the same profit (i.e. 25% on Total Cost) the Selling Price should be increased by 25% Illustration 5: The Modern Manufacturing Co. submits the following information on 31st March, 2010. 2.75.000 7.000 4,000 1.10,000 3.000 4.000 65,000 Sales for the year Inventory at the beginning of the year Finished Goods Work-in-progress Purchase of materials for the year Materials inventory at the beginning of the year Materials inventory at the end of the year Direct labour Factory overheads were 60% of the direct labour cost Inventories at the end of the year Work-in-Progress Finished goods Other Expenses for the year Selling Expenses 10% of sales Administrative Exps 5% of sales Prepare a statement of cost. 6,000 8,000