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Profit and loss with overhead expenses - class-XI

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An example of a production overhead would be:

  1. materials

  2. labour cost

  3. supervisory costs

  4. rent


Correct Option: C
Explanation:

An example of a production overhead would be supervisory costs.
Materials and labour costs would be directly attributable to the product and would be classed as direct costs. Rent is a non production overhead but salaries of supervisors are related to production and are an overhead as they do not vary directly with output.

Repairs, taxes, insurance, rent are all examples of

  1. overhead expenses

  2. interest

  3. company profit

  4. cost price


Correct Option: A
Explanation:
Overhead expenses are all costs on the income statement except for direct labour, direct materials, and direct expenses. 
Overhead expenses include accounting fees, advertising, insurance, interest, legal fees, labour burden, rent, repairs, supplies, taxes, telephone bills, travel expenditures, and utilities.

An ______ is the additional cost which is added to the cost price of an item.

  1. interest

  2. cost

  3. overhead

  4. profit


Correct Option: C
Explanation:

By definition, Overhead is the additional cost which is added to the cost price of an item. 

Overhead expenses are all costs on the income statement except for direct labour, direct materials, and direct expenses. 
Overhead expenses include accounting fees, advertising, insurance, interest, legal fees, labour burden, rent, repairs, supplies, taxes, telephone bills, travel expenditures, and utilities.

Absorption costing is closely related to which of the following cost elements?

  1. Direct labour

  2. Overheads

  3. Total cost

  4. Machine


Correct Option: B
Explanation:

Absorption costing is closely related to overhead expenses.

The additional cost spent on transportation, maintenance, labour, repair, etc., expenses incurred are called _______.

  1. overhead expenses

  2. additional charge

  3. fixed amount

  4. cost price


Correct Option: A
Explanation:

The additional cost spent on transportation, maintenance, labour, repair, etc., expenses incurred are called $\text{Overhead expenses}$.

Overhead is those expenses required to run a business, but which cannot be directly attributed to any specific business activity, product, or service. 
Thus, overhead expenses do not directly lead to the generation of profits. Overhead is still necessary, since it provides critical support for the generation of profit-making activities.

Raman goes to the school book store with Rs.100.he purchases some books and comes back with Rs.68.70 with him.After sometime,he goes again to the store with Rs.250 and purchases some books and comes back with Rs.166.50.How much did he spend in all and how much money is left with him?

  1. Rs.126.93, Rs.234.20

  2. Rs.234.20, Rs.118.96

  3. Rs.114.80, Rs.235.20

  4. Rs.115.80, Rs.126.930


Correct Option: C
Explanation:

 In first time when Raman goes to store he has 100 Rs.  and come back with Rs. 68.70 then ,

spend money will be = 100-68.70=Rs. $31.30$
now when he goes second time he has Rs. 250 and come back with Rs. 166.50 then,
spend money will be = 250-166.50= Rs. $83.50$
hence he has spend money will be= 31.30+83.50= Rs. $114.80$
 and he have left money will be= 68.70+166.50= Rs. $235.20$
Here answer is option $C$.

Brett currently spends $ $160$ each month on gas. His current car is able to travel $30$ miles per gallon of gas. He decides to switch his current car for a new car that is able to travel $40$ miles per gallon of gas. Assuming the price of gas stays the same, how much will he spend on gas each month with the new car?

  1. $ $100$

  2. $ $120$

  3. $ $130$

  4. $ $140$


Correct Option: B
Explanation:
Let $x$ be the price of gas per gallon
$\implies$ the fills $\dfrac{160}{x}$ gallons every month
$\implies$ He travels totally $30\times \dfrac{160}{x}$ every month $=\dfrac{4800}{x}$ miles
with his new car he needs to fill only $\dfrac{\left(\dfrac{480}{x}\right)}{40}=\dfrac{120}{x}$ gallons
Total Price $=\dfrac{120}{x}\times x$
                   $=\$120$

Mr. Sharma left one-third of his property to his son, one-fourth to his daughter and remainder to his wife. If his wife's share is $Rs. 18,000$, what was the worth of his total property?

  1. Rs. $43,100$

  2. Rs. $43,200$

  3. Rs. $43,300$

  4. Rs. $43,400$


Correct Option: B
Explanation:

Let the total property was of Rs. $x$.

Then his son's share Rs. $\dfrac{x}{3}$ and his daughter's share $\dfrac{x}{4}$ and his wife's share $x-\dfrac{x}{3}-\dfrac{x}{4}=\dfrac{5x}{12}$.
According to the problem,
$\dfrac{5x}{12}=18,000$
or, $x=43,200$.
So total property worth was of Rs. $43,200$.

if 5 men and 9 women can do a piece of work in 19 days then in how many days will 3 men and 6 women do the same work ?

  1. 12 days

  2. 15 days

  3. 18 days

  4. 21 days


Correct Option: B
Explanation:
It is given that 5 men or 9 women can do the job in 19 days.

So, 5 men=9 women

1 man = $\dfrac { 9 }{ 5 }$ women

3 men = 3 $(\dfrac { 9 }{ 5 } )$ women

So, work done = 3 men+6 women = 3 $(\dfrac { 9 }{ 5 } )+6$

$=\dfrac { 27 }{ 5 } +6$

$=\dfrac { 57 }{ 5 } $

Now,$ \dfrac { {M} _{1} {D} _{1} }{{W} _{1} }$= $ \dfrac { {M} _{2} {D} _{2} }{ {W} _{2} } ,$ 

let ${D} _{2} = x$

$\dfrac { 9*19 }{ {W} _{1} } = \dfrac { \dfrac { 57 }{ 5 } *x }{ {W} _{2} }$

$ \Longrightarrow 9*19=\dfrac { 57x }{ 5 }$

$ \Longrightarrow 3=\dfrac { x }{ 5 }$

$ \Longrightarrow x=15$ days

So, option (b) is correct.

The average of the price per kg. of rice at $10$ different places was $Rs.4.85$. After a week, the price per kg. was increased by $20$ paise at $3$ places and decreased by $10$ paise at one place. The new average of price per kg is :

  1. $Rs. 4.88$

  2. $Rs. 4.86$

  3. $Rs. 4.90$

  4. $Rs. 5.35$


Correct Option: A

The cost price and the overhead expanses together make up the effective seilling price.

  1. True

  2. False


Correct Option: A

A boy saves $Rs 4.65$ daily than the least number of days in which he will be also to save an exact number of rupees is

  1. $15$

  2. $20$

  3. $12$

  4. $10$


Correct Option: B
Explanation:
Rs.$4.65=465$Paise
The exact number of rupees will be a multiple of $100$
So, we have to fine the L.C.M. of $465$ and $100$
$100 = 2\times 2\times 5\times 5$
$465 = 3\times 5\times 31$
L.C.M. of $465$ and $100 = 2\times 2\times 3\times 5 \times 5\times 31= 9300$
So, the boy saves $9300$ paise.
Hence, least number of days required to save $9300$ paise $=\dfrac{9300}{465}= 20$ days

If the cost of $x$ metres of wire is $d$ rupees, then what is the cost of $y$ metres of wire at the same rate?

  1. Rs. $x\dfrac{d}{y}$

  2. Rs. $xd$

  3. Rs. $y\dfrac{d}{x}$

  4. Rs. $yd$


Correct Option: C
Explanation:
Given, cost of $x$ metres of wire = Rs. $d$

cost of $1$ metre of wire = Rs.$\dfrac{d}{x}$

cost of $y$ metre of wire = Rs $y\dfrac{d}{x}$

$A 'B'$ & $'C'$ are going to buy books that cost $Rs 540$ if A pays $Rs 40$ more than B and B pays twice as much as C, how much does C pay?

  1. $Rs 100$

  2. $Rs 140$

  3. $Rs 160$

  4. $Rs 200$


Correct Option: A
Explanation:

Let the cost paid by $C$ be $x$ 

The cost paid by $B$ is $2x$
The cost paid by $A$ is $2x+40$
The total cost is $x+2x+2x+40=540\5x+40=540\5x=500\x=100$

Karuna bought a car for a certain sum of money. She spent $10$% ofthe cost on repairs and sold the car for a profit of Rs. $11,000$. How much did she spend on repairs, if she made a profit of $20$%?

  1. Rs. $4,000$

  2. Rs. $4,400$

  3. Rs. $5,500$

  4. Rs. $5,000$


Correct Option: D
Explanation:

Let CP of car be Rs. x.
Cost on repair = $\displaystyle\frac{x}{10}$
Total cost = $x\, + \, \displaystyle\frac{x}{10}\, = \, \frac{11x}{10}$

We have, $\displaystyle\frac{11x}{10}\,\times\, \frac{20}{100}\, =\, \frac{11x}{50}\,=\, 11000$
x = 50000

Cost on repair = $\displaystyle\frac{x}{10}\,=\, \frac{50000}{10}$
Rs. 5000

The cost of manufacturing a TV set is made up of material costs labour costs and overhead costs These costs are in the ratio $4 : 3 : 2$ If materials costs and labour costs rise by $10 \%$ and $8 \%$ respectively while the overhead costs reduce by $5 \%$ what is the percentage increase in the total coast of the TV set ? 

  1. $6 \%$

  2. $8 \%$

  3. $4 \%$

  4. $10 \%$


Correct Option: A
Explanation:

Let the cost of the T.V. be $Rs.\ x$ Then 
Material coast $\displaystyle =\frac{4x}{9}$ ,Labour coast $\displaystyle =\frac{3x}{9}$ ,Overhead costs $\displaystyle =\frac{2x}{9}$ New material cost $\displaystyle =\frac{110}{100}\times \frac{4x}{9}=\frac{44x}{90}$\ 
New labour cost $\displaystyle =\frac{108}{100}\times \frac{3x}{9}=\frac{9x}{25}$
New overhead costs $\displaystyle =\frac{95}{100}\times \frac{2x}{9}=\frac{19x}{90}$
Increase in the cost of T.V.=$\displaystyle \left ( \frac{44x}{90}-\frac{4x}{9} \right )+\left ( \frac{9x}{25}-\frac{3x}{9} \right )+\left ( \frac{19x}{90}-\frac{2x}{9} \right )$
$\displaystyle =\frac{4x}{90}+\frac{2x}{75}-\dfrac{x}{90}=\dfrac{20x+12x-5x}{450}=\dfrac{27x}{450}$ $\displaystyle \therefore increase: in: cost=\dfrac{\dfrac{27x}{450}}{x}\times 100\%=\dfrac{2700}{450}\%=6\%$

Maya bought a television for $14,500$ rupees and spent $500$ rupees on transportation. she sold that television for $12,000$ rupees. Calculate her loss percent.

  1. $12.22\%$

  2. $32.23\%$

  3. $22.22\%$

  4. $20\%$


Correct Option: D
Explanation:

Price paid for buying a TV $=14,500$
Amount spent on transportation $= 500$
Total cost of the TV $=$ cost price $= 14,500 + 500 = 15,000$
Selling price $ = 12,000$
Loss $=$ C.P. $-$ S.P. $= 15,000 - 12,000=  3000$
Loss $\%$ $= \dfrac{loss}{C.P.}\times 100$ $\% =$ $\dfrac{3000}{15000}\times 100$ $\%$ 
$= 20$ $\%$

A company buy a machine for $7000$ rupees and spends $2000$ for electricity and labour charges. If he sells these machine at $5000$ rupees. Find his loss percent.

  1. $12.22\%$

  2. $32.23\%$

  3. $22.22\%$

  4. $44.44\%$


Correct Option: D
Explanation:

Price paid for buying a machine $= 7000$
Amount spent on electricity and labout $= 2000$
Total cost of the machine $=$ cost price $= 7000 + 2000 = 9000$
Selling price $= 5000$
Gain $=$ C.P. $-$ S.P. $= 9000 - 5000 = 4000$
Gain $\% =$ $\dfrac{Gain}{C.P.}\times 100$ $\% =$ $\dfrac{4000}{9000}\times 100$ $\%$ 
$= 44.44\%$

A mechanic bought an old car for 2300 rupees and spent 1200 rupees on its repair, denting and painting. He sold that car for 4500 rupees. Calculate his profit percent.

  1. 12.22%

  2. 32.23%

  3. 28.57%

  4. 12.45%


Correct Option: C
Explanation:

Price paid for buying a car =C.P= $Rs. 2300$
Amount spent on repair =$Rs. 1200$
Total cost of the cycle = cost price =$Rs. 2300 + Rs.1200 = Rs.3500$
selling price = S.P = $ Rs. 4500$

Gain percentage = $ \dfrac{S.P - C.P }{C.P} \times {100}$
=$\dfrac{1000}{3500} \times {100}$

=$ 28.57 $ %

Mike bought an old cycle for $500$ rupees and spent $100$ rupees on its repair. He sold that cycle for $1200$ rupees. Calculate his profit percent.

  1. $12.22\%$

  2. $32.23\%$

  3. $22.22\%$

  4. $100\%$


Correct Option: D
Explanation:

Price paid for buying a cycle $=$ C.P. $=$ Rs. $500$
Amount spent on repair $=$ Rs. $100$
Total cost of the cycle $=$ cost price $=$ Rs. $500 +$ Rs. $100 = $ Rs. $600$
Selling price $=$ S.P $=$ Rs. $1200$
Gain percentage $=$ $ \dfrac{S.P - C.P }{C.P} \times {100}$
$=$$\dfrac{600}{600} \times {100}$
$=$$ 100$ $\%$

Dolly buys some laptop from a wholesaler for Rs. 10000 and spends Rs. 2000 on its transportation's, Rs. 1400 for delivery charges and Rs. 1300 for load man etc. Find the overhead charges spent by Dolly.

  1. 3300

  2. 4700

  3. 2000

  4. 5000


Correct Option: B
Explanation:

Overhead charges spent by Dolly =  transportation + delivery charges + load man charges
Overhead charges spent by Dolly = $2000 + 1400 + 1300 = Rs. 4700$

Ann bought a new car for Rs. 150000 and spent Rs. 4000 for registration and transportation for Rs. 2000. What is the total amount she spent including the overhead charges?

  1. 156000

  2. 234000

  3. 341900

  4. 44100


Correct Option: A
Explanation:

Total amount spent by Ann = Cost price + overhead expenses
= $150000 + 4000 + 2000 = Rs. 156000$

Mike buys some electronic goods from a wholesaler for Rs. 650 and spends Rs. 200 on its transportation's, etc. If he sells these electronic goods for Rs. 900; find the overhead expenses spent by Mike. and find profit.

  1. Rs.650,  Rs. 50

  2. Rs. 900, Rs. 150

  3. Rs. 200,  Rs.50

  4. Rs .850 , Rs.100


Correct Option: C
Explanation:

The overhead charges become a part of the cost price.
So, Rs. 200 is a overhead expenses spent by Mike.

Total CP = Rs. 650+ Rs. 200 = Rs 850
SP > CP

hence Profit =  SP - CP =  900 - 850 = Rs.  50

The amount spent on repairs, labour charges and transportation etc expenses are called as

  1. overhead expenses

  2. underneath expenses

  3. beneath expenses

  4. fixed expenses


Correct Option: A
Explanation:

The amount spent on repairs, labor charges and transportation etc. expenses are called as overhead expenses.

A person bought a shirt at a certain price and paid the same price for the trouser. If the trouser had cost rupees twenty less and the shirt $Rs.15$ more, the price of the trouser would have only half that of the shirt. Find the cost of shirt.

  1. $Rs.60$

  2. $Rs.45$

  3. $Rs.55$

  4. $Rs.50$


Correct Option: C
Explanation:

Let the price of the shirt and trouser be Rs. $ x $.
As per the statement, " If the trouser had cost rupees twenty less and the shirt Rs. $15$ more, the price of the trouser would have only half that of the shirt " => $ x-20 = \frac {x+15}{2} $
$ => 2x-40 = x  +15 $
$ x = 55 $
Cost of the shirt $ = Rs  55 $.

By selling 32 clips for a rupee, a man loses 40%. How many a rupee must he sell to gain 20%?

  1. 64

  2. 30

  3. 24

  4. 16


Correct Option: D
Explanation:

b'S.P. of 1 clip $\displaystyle=\frac{1}{32}$ of a rupee

$\implies$ 60% of CP $\displaystyle=\frac{1}{32}$ of a rupee

$\therefore$ 120% of CP $\displaystyle=\frac{1}{32}\times\frac{120}{60}$ i.e. $\displaystyle\frac{1}{16}$ of a rupee

$\implies$ he should sell 16 clips for a rupee.'

Reshma sells an article to Rekha at $37.5\%$ profit, Rekha sells it to Madhu at $9\dfrac{1}{11}\%$ profit. Again Madhu sells it to Mitu at $25\%$ loss. If Mitu pays $Rs\ 342$ for the article, then what is the cost price of the article to Reshma?

  1. $Rs\ 304$

  2. $Rs\ 266.50$

  3. $Rs\ 380$

  4. $Rs\ 384.75$


Correct Option: A

By selling a watch for Rs 480, a man gains 25%. How much per cent would he gain by selling it for Rs 432?

  1. $15\%$

  2. $\displaystyle6\frac{1}{4}\%$

  3. $\displaystyle12\frac{1}{2}\%$

  4. $25\%$


Correct Option: C

Choose the correct answer from the alternatives given :
Mr. Ram runs a clothing store. His overhead expenses are 32% and his profits are 12% of his sale. At what price should he sell a raincoat which costs him Rs. 10.50 ?

  1. Rs. 13

  2. Rs. 15.52

  3. Rs. 12

  4. Rs. 19


Correct Option: B
Explanation:
Cost price of umbrella $=Rs.10.50$
    overhead expenses $=32$% $=0.32$
            Required profit $=12$% $=0.12$
So, Selling price of umbrella $=Rs.10.50\times 1.32\times 1.12$
                                                $=Rs.15.52$
So, selling price $=Rs.10.50\times 1.32\times 1.12$
                           $=Rs.15.52$.
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