Calculate the machine hour rate to recover the overhead expenses given below :

                                       Per hour Per annum

Electric Power

75 Ps. Steam 10 Ps.

Water 2Ps.

Repairs                                            Rs. 530

Rent                                                 Rs. 270

Running hours

Rs. 2,000

Original cost                                      Rs. 12,500

Book value Rs. 2, 870

Replacement value Rs. 11, 500         

Hint : (Depreciation to be charged on original cost.)

To calculate the machine hour rate to recover the overhead expenses, we need to determine the total overhead expenses per annum and divide it by the running hours per annum.

Given information:
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