Industrial Engineering Submit on 10-02-2014 Faculty Name: - Ravi Kumar

Chapter: 3 Manufacturing cost Department of Mechanical Engineering

ECHELON INSTITUTE OF ECHELON INSTITUTE OF ECHELON INSTITUTE OF ECHELON INSTITUTE OF TECHNOLOGY TECHNOLOGY TECHNOLOGY TECHNOLOGY
Assignment-1
NOTES:
1. Two marks will be deducted for not submitting the assignment.
2. Assignment should be hand written/printed (Faculty Can Change Accordingly).
3. Copied Assignment will not be accepted.

Q-1 Give the statement for following:
i) Direct and Indirect cost [MDU-2010,2009] (10 marks)
ii) Fixed and variable cost [MDU-2010] (10 marks)
Q-2 A company is producing certain type of circuit breakers. The cost of land, building etc., is Rs. 40,000/-.
The variable cost is Rs. 10/- per unit production. If the sale pirce of a product is rs. 20/- per unit. (15 marks)
i. what should be the minimum production level.
ii. If the company is operating at present so that the production is 8,000 units, what is the firm profit and
margin of safety.
Q-3 The list price of a machine is Rs. 6000/- and the distributor is allowed 20% discount. The marketing and
administrative expenditure is 50% of factory cost and the material cost, labour cost and factory overheads are in
the ratio 1:3:2. If the cost of labour on the manufacture of machine is Rs. 1200. Determine the profit on the each
machine.[MDU-2012] (15 marks)
Q-4 In the production of a product the fixed costs are Rs. 6,000/- and the variable cost is Rs. 10/- per product. If
the sale price of the product is Rs. 12/-, the break even volume of products to be made will be: [IES-2008]
(a) 2000 (b) 3000 (c) 4000 (d) 6000
Q-5 Process I requires 20 units of fixed cost and 3 units of variable cost per piece, while Process II required 50
units of fixed cost and 1 unit of variable cost per piece. For a company producing 10 piece per day [IES-1997]
(a) Process I should be chosen
(b) Process II should be chosen
(c) Either of the two processes could be chosen
(d) A combination of process I and process II
should be choose
Q-6 Process X has fixed cost of Rs. 40,000 and variable cost of Rs. 9 per unit whereas process Y has fixed cost
of Rs.16, 000 and variable cost of Rs. 24 per unit. At what production quantity, the total cost of X and Y are
equal? [IES-2004]
(a) 1200 units (b) 1600 units (c) 2000 units (d) 2400 units