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    Question

    Find the cost of manufacturing each article if a

    manufacturer estimates that on inspection 17% of the articles he produces will be rejected. He accepts an order to supply 50,000 articles at Rs. 11 each. He estimates the profit on his outlay including the manufacturing of rejected articles to be 10%.
    A Rs 8.30 Correct Answer Incorrect Answer
    B Rs 7.30 Correct Answer Incorrect Answer
    C Rs 8.25 Correct Answer Incorrect Answer
    D Rs 4.30 Correct Answer Incorrect Answer
    E None of these Correct Answer Incorrect Answer

    Solution

    If 100 articles are manufactured then 17 will be rejected
    Total selling price of 83 articles = 83 × 11 = 913
    Total cost price = (913 x 100)/110 = 830
    cost of manufacturing per article = 830/100 = Rs 8.30

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