Safety First Tyre Company is the manufacturer of 'Puncture Resistant' motorcycle tyres. In the manufacturing process, it undertakes three different…

Safety First Tyre Company is the manufacturer of 'Puncture Resistant' motorcycle tyres. In the manufacturing process, it undertakes three different jobs namely, Belting (B), Extrusion (E) and Vulcanizing (V). All the three jobs require the use of a special machine and also the use of Artificial Intelligence (AI) system when necessary. The AI system is hired from outside and the hire charges paid for every quarter is 4,08,000. An estimate of overhead expenses relating to the special machine is given below: The cost of the special machine is 66,00,000 and depreciation is charged @ 10% per annum on straight line basis.Rent paid for every six months is 1,38,000.Other indirect expenses per annum - 4,92,000. During the first month of operation, the following details are available from the job book of the company: Jobs Belting (B) Extrusion (E) Vulcanizing (V) Number of hours the special machine was used Without the use of Artificial Intelligence (AI) system 600 900 - With the use of Artificial Intelligence (AI) system 450 550 1000 Any fraction in calculations may be rounded off up to two decimal places. On the basis of the above Case Scenario, you are required to answer the following MCQs 6 to 10: