a machine costs rs 1 00 000 and is deemed to have a scrap value of 5 at the end of i 559086

A machine costs Rs 1,00,000 and is deemed to have a scrap value of 5% at the end of its effective life (19 years). Ordinarily, the machine is expected to run 2,400 hours per annum, but it is estimated that 150 hours will be lost for normal repairs and maintenance and further 750 hours will be lost due to staggering. The other details in respect of the machine shop are as follows


Wages, bonus and provident fund, contribution of each of two operators (each operator is in charge of two machines)

6,000 per year

Rent and rates of the shop

4,500 per year

General lighting of the shop

250 per month

Insurance premium for the machine

200 per quarter

Cost of repairs and maintenance per machine

250 per month

Shop supervisor’s salary

500 per month

Power consumption of the machine hour 20 units

Rate of power per hundred units = Rs 10

Other factory overheads attributable to the shop = 5,000 per year

There are 4 identical machines in the shop. The supervisor is expected to devote one fifth of his time for supervising the machine. Compute a comprehensive MHR from the above details.

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