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Factory overhead is Rs 3,00,000 and direct material cost is Rs 5,00,000 What is the overhead rate under direct material cost method?

A. 25%

B. 30%

C. 60%

D. 75%

Answer: Option C

Solution(By Examveda Team)

Overhead rate = Factory overhead / Direct material cost * 100
= 300000 / 500000 * 100 = 60%.

This Question Belongs to Commerce >> Costing

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Comments ( 1 )

  1. Naaresh Kumar
    Naaresh Kumar :
    6 years ago

    300000/50000*100=60%

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