Profit and loss with overhead expenses - class-XI

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.

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

Absorption costing is closely related to overhead expenses.

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

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

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.=$\displaystyle \left ( \frac{44x}{90}-\frac{4x}{9} \right )+\left ( \frac{9x}{25}-\frac{3x}{9} \right )+\left ( \frac{19x}{90}-\frac{2x}{9} \right )$
$\displaystyle =\frac{4x}{90}+\frac{2x}{75}-\dfrac{x}{90}=\dfrac{20x+12x-5x}{450}=\dfrac{27x}{450}$ $\displaystyle \therefore increase: in: cost=\dfrac{\dfrac{27x}{450}}{x}\times 100%=\dfrac{2700}{450}%=6%$

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 $%$ $= \dfrac{loss}{C.P.}\times 100$ $% =$ $\dfrac{3000}{15000}\times 100$ $%$ 
$= 20$ $%$

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 $% =$ $\dfrac{Gain}{C.P.}\times 100$ $% =$ $\dfrac{4000}{9000}\times 100$ $%$ 
$= 44.44%$

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 $ %

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$ $%$

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

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

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

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.'

Let CP be x. Reshma sells at 37.5% profit (1.375x). Rekha sells at 9 1/11% profit (1/11 fraction, so 12/11 * 1.375x). Madhu sells at 25% loss (0.75 * 12/11 * 1.375x = 342). Solving for x: 0.75 * 1.0909 * 1.375x = 342 -> 1.125x = 342 -> x = 304.

Selling at 480 with 25% gain means CP = 480 / 1.25 = 384. Selling at 432 gives a gain of 432 - 384 = 48. Percentage gain = (48 / 384) * 100 = 12.5%.