Mark Trucks Limited has some idlecapacity in its plant, which is restored by accepting order fromother automobiles industries. The company has finished assembly of150 trucks against special order N, 13A from Western MotorsLimited. The pertinent data are as under:
Started October 3,2008.
Finished November 2, 2008.
Departments Material cost (Rs)
Labor hours Rate per labor hours (Rs)
Assembly 150,000 4,500 18
Painting 75,000 1,200 15
Finishing 45,000 600 12
Factory pay roll for the year is expected to amount
Rs.1, 281,000.
Factory overhead for the year is estimated at
Rs 1776, 000.Departmental break-up is provided below:
Departments Pay rolls (Rs.) Factoryover head (Rs.)
Assembly 972,000 1296,000
Painting 225,000 375,000
Finishing 84,000 105,000
Factory overhead is based on direct labor hours. The componentinventory has been supplied by Western Motors Limited. But theother material has been added by the company.
The agreed price to be charged is cost plus 20% mark-up, subjectto a maximum charge of Rs.5, 000 Per truck
Required:
1. Prepare a Job Cost Sheet for Job No.13A,following properformat
2. Pass the necessary Journal entries and prepare T account ofWork-In-Process.
3. Calculate Cost per unit.
4. Calculate Total gross profit.