The result of product cost analysis show that direct material is 30% of prime cost Prime cost is 60% of total manufacture cost

answer C is correct

100%=(30%x60%)+(70%x60%)+40%

Correct Answer option D -60%

Given DM cost =30% of prime cost Prime cost =60 % of total mfg costs Required: DL cost % of total mfg cost? prime cost = DM cost + DL cost PC - DM cost = DL cost1 -0.3 =0.7 So, DL cost =70% of Prime cost mfg cost = DM cost + DL cost + MOH cost mfg cost = prime cost + MOH cost prime cost =60% of mfg cost (given) mfg cost =1/0.6 mfg cost =166.67 prime cost =166.67 ×60% prime cost =100 DL cost =100 ×70% of prime cost DL cost =70 DL cost % of mfg cost =70 ÷166.67 DL cost =42% of total mfg costs So, the answer is choice C,42%

The correct answer is option (C )  direct labor should be42%n of total manufacture cost.

 

The answer is C-42%. Prime Cost comprises Direct Material and Direct Labor Cost. From the question DM=30 and DL=70, so Prime Cost=100, which is60% of Total MFG cost so the Total MFG Cost is100/0.6 i.e.,166.7. The direct labor cost would be70/166.7 =42%

A-                                       

30%

Correct answer is40% Thanks