Answer
Verified
378k+ views
Hint: Overhead expenses are the variable, fixed or semi variable expenses that are not directly involved with a company’s service or the product. For example transportation expenses, rent expenses, administrative expenses or employee salaries. Therefore overhead charge becomes a part of the cost price.
Complete step-by-step solution:
The transportation expenses will be considered as overhead expenses. That is overhead expenses $ = Rs.200$
Cost price $\left( {CP} \right)$ = Payment made while purchasing the goods $ + $ overhead expenses.
It is given that Mike buys electronic goods at $Rs.650$ and spends $Rs.200$ on transportation (Overhead expenses).
Therefore, the total cost price of electronic goods $\left( {CP} \right)$ $ = Rs.650 + Rs.200$
$CP = Rs.850$
Given, Selling price $\left( {SP} \right)$ $ = Rs.900$
Hence, $SP > CP$. [Selling price is greater than the cost price]
We know that, profit $ = SP - CP$ $\left( {\because SP > CP} \right)$
Therefore, profit $ = Rs.900 - Rs.850$
Profit $ = Rs.50$
Hence, the correct option is C, $Rs.200,Rs.50$.
Note: Because of overhead expenses that are extra expenses, the actual profit will become less. The person should include the overhead expenses to the cost price and then sell the goods by keeping the selling price more than the total cost price to get the profit.
Complete step-by-step solution:
The transportation expenses will be considered as overhead expenses. That is overhead expenses $ = Rs.200$
Cost price $\left( {CP} \right)$ = Payment made while purchasing the goods $ + $ overhead expenses.
It is given that Mike buys electronic goods at $Rs.650$ and spends $Rs.200$ on transportation (Overhead expenses).
Therefore, the total cost price of electronic goods $\left( {CP} \right)$ $ = Rs.650 + Rs.200$
$CP = Rs.850$
Given, Selling price $\left( {SP} \right)$ $ = Rs.900$
Hence, $SP > CP$. [Selling price is greater than the cost price]
We know that, profit $ = SP - CP$ $\left( {\because SP > CP} \right)$
Therefore, profit $ = Rs.900 - Rs.850$
Profit $ = Rs.50$
Hence, the correct option is C, $Rs.200,Rs.50$.
Note: Because of overhead expenses that are extra expenses, the actual profit will become less. The person should include the overhead expenses to the cost price and then sell the goods by keeping the selling price more than the total cost price to get the profit.
Recently Updated Pages
How many sigma and pi bonds are present in HCequiv class 11 chemistry CBSE
Mark and label the given geoinformation on the outline class 11 social science CBSE
When people say No pun intended what does that mea class 8 english CBSE
Name the states which share their boundary with Indias class 9 social science CBSE
Give an account of the Northern Plains of India class 9 social science CBSE
Change the following sentences into negative and interrogative class 10 english CBSE
Trending doubts
Fill the blanks with the suitable prepositions 1 The class 9 english CBSE
Give 10 examples for herbs , shrubs , climbers , creepers
Change the following sentences into negative and interrogative class 10 english CBSE
Difference between Prokaryotic cell and Eukaryotic class 11 biology CBSE
The Equation xxx + 2 is Satisfied when x is Equal to Class 10 Maths
How do you graph the function fx 4x class 9 maths CBSE
Differentiate between homogeneous and heterogeneous class 12 chemistry CBSE
Application to your principal for the character ce class 8 english CBSE
Write a letter to the principal requesting him to grant class 10 english CBSE