Question No-1

1. The estimated material cost of a job is Tk. 5000 and direct labor cost is likely to be Tk. 1000. In a machine shop it will require machining by Machine No. 8 for 20 hrs. and by Machine No.11 for 6 hours. Machine hours rates for Machine No. 8 and Machine No. 11 are respectively Tk. 10 and 15. Considering only machine shop cost, the direct wages in all other shops last year amounted to Tk. 80,000 as against Tk. 48,000 factory overhead. Last year factory cost of all jobs amounted to Tk. 2,50,000 as against Tk. 37,500 office expenses. Prepare a quotation which guarantees 20% profit on selling price.

2. In respect of a factory, the following particulars have been extracted for the year 2019:

Cost of materials	6,00,000
Wages	5,00,000
Factory Overheads	3,00,000
Administration Charges	3,36,000
Selling Charges	2,24,000
Distribution Charges	1,40,000
Profit	4,20,000

A work order has to be executed in 2020 and the estimated costs are: Material 40000, Wages 25000.

Assuming that in 2020 the rate of factory overhead has gone down by 10%, distribution charges have gone up by 15% and selling administration charges have each gone up by 5%, at what price should the product be sold as to earn the same rate of profit on the selling price as in 2019?

Factory overheads are based on wages and administration selling and distribution overheads on factory cost.