Please answer exercise 7.2 from the attached paper.
Before tackling this question, the first thing you may want to note are the various costs that usually form a part of the total cost to do a job. These often include the direct costs (which are directly traceable and often include direct material and direct labour); and, the indirect costs (which are not directly traceable and often include indirect labour, indirect material, lighting, depreciation and other overhead costs).
In the question given, all your indirect costs would include:
Indirect Labour Costs 25,000.00
Depreciation of Machine 8,000.00
Rent and Rates 10,000.00
Heat, Lighting and Power 5,000.00
Indirect Materials ...
This solution provides you with information related to Pieman Products Limited and the full costing of its trailer.