The prime cost of an article is three times the value of the raw material…

2024

The prime cost of an article is three times the value of the raw material used. The cost of raw materials increases in the ratio of 5 : 12 and manufacturing expenses in the ratio 4 : 5. The article, which originally cost rs. 6, will new cost? (Round off your answer to nearest integer value)

  1. A.

    10

  2. B.

    20

  3. C.

    15

  4. D.

    13

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Correct answer: A

Solution: Step-by-step calculation.

  1. Let the raw material cost be x. Prime cost = raw material + manufacturing = 3x. Given original cost = 6, so 3x = 6 ⇒ x = 2.

  2. Raw material increases in the ratio 5:12, so new raw material = 2 × (12/5) = 24/5 = 4.8.

  3. Original manufacturing expenses = 6 − 2 = 4. They increase in the ratio 4:5, so new manufacturing = 4 × (5/4) = 5.

  4. New total cost = 4.8 + 5 = 9.8. Rounding to the nearest integer gives 10.

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