Question 3
(a) Mention any four items covered by overheads in costing a painting job.
(b) Outline any five factors to be considered when costing painting and decorating job.
(c) Explain the following in the costing of painting and decorating job:
(i) prime cost;
(ii) net profit.
Observation
The question attracted a good number of candidates and it was creditably attempted by some of these candidates. However, some others showed lack of understanding of costing in decorating job. The candidates were expected to highlight some the following points in their responses:
(a) Items covered by overheads
- Rent for office space
- Electricity bills
- Telephone bills
- Depreciation of tools, plants and equipment
- Cost of advertisement
- Insurance
- Staff salary
- Stationery
- Office equipment
- Staff welfare
- Transportation
- Tax
- Union due
(b) - Cost of materials
- Cost of labour
- Cost of tools/equipment
- Nature of job
- Location of the site
- Overheads
- Profit margin
(c) (i) Prime cost
This is the actual calculated cost of labour and material for a job before the addition of overheads and profits.
(ii) Net Profit
This is the amount of money realized after all expenses on a job.