Post on 05-Mar-2015
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PROFORMA COST SHEETFOR THE PERIOD ENDING…..
Particulars Rs
Opening stock of RM XXXX
+ Purchases of RM XXX
+ Carriage Inwards XXX
- Closing Stock of RM XXX
COST OF MATERIALS CONSUMED XXXX
Direct labor cost XXX
Direct Expenses XXX
PRIME COST XXXX
Factory overhead XXX
+ Opening stock of WIP XXX
- Closing stock of WIP XXX
Work Cost XXXX
Direct material Cost
Indirect Factory Cost
Contd……….
Office & Administrative overheads XXX
COST OF PRODUCTION XXX
+ opening stock of FG XXX
- Closing stock of FG XXX
COST OF GOODS SOLD XXX
Selling & Distribution overheads XXX
TOTAL COST OF SALES XXX
PROFIT XXX
SALES XXX
PROBLEM 1:38&39
FROM THE FOLLOWING PARTICULARS YOU AREREQUIRED TO PREPARE A STATEMENT SHOWING :
1. value of materials consumed
2. Total cost of production
3. Cost of goods sold
4. The selling price of each unit of the commodity
Particulars Rs
Opening Stock of Raw Materials 25000
Opening Stock of finished goods(400units) 20000
Wages paid to laborers 100000
Raw materials bought 250000
Closing Stock: 1.Raw Material 2. Finished Goods(800 units)
2000025000
Chargeable expenses 10000
Rent Rates and Taxes(Factory) 25000
Motives power 10000
Factory heating& lighting 10000
Factory Insurance 5000
Income tax paid 6000
Experimental expenses 2500
Waste Materials 1000
Office salaries 20000
CONTD
Printing & Stationary 1000
Salesmen’s Salary 10000
Commission to Travelling agents 5000
Cost of Free samples 500
Donations to charitable funds 1000
WIP- on 1st Jan On 31st Dec
9003000
Other selling expenses were calculated to be 20 paise per unit. Total production during the yearWas 6400 units. If a profit of 25% on sales is to be realised what would be the total sales?
Solution:- Cost sheet Particulars Rs Total Cost Cost Per Unit
Opening Stock of RMAdd- Pur of RM
Less- Closing stock of RM
Cost of Material Consumed
Direct WagesChargeable exp
Prime Cost
Factory Cost:-Rent
Motive PowerHeating
Insurance Experimental
expensesWaste Materials
2500025000027500020000
25000100001000050002500
1000
25500010000010000
365000
Particulars Rs Total Cost Cost Per Unit
Add- opening stock Of WIP
Less- closing stock of WIP
Work Cost
Office on costSalariesPrinting
Cost of productionAdd- opening stock of
FG
Less- closing of FG
53500
90054400
3000
200001000
51400416400
21000
437400
2000045740025000
432400
8.0365.06
3.28
68.34
-----68.34-----
72.066
Particulars Rs Total Cost Cost Per Unit
Selling & Distribution O/H
SalaryCommission
Free SamplesOther Selling exp
Cost of SalesProfit 1/3 on cost
Sales
WORKING NOTES:-
Units produced Add- opening stock of
FG
Less- closing stock
100005000500
120016700
449100149700598800
Units sold
2.78474.8524.9599.80
6400units
400units6800 units800units
6000 units
Calculation of other selling expenses on units sold
Particulars Rs Total Cost Cost Per Unit
For 6000 units @ Rs. 0.20p = Rs. 1200
(2)Calculation of Profit on cost price
Selling Price= Cost Price + Profit100= 75+25
= 25/75*449100=149700
3) Donations to charitable fund, and IT paid are items of pure finance hence they are Not included in cost sheet
Problem 2: pg 40
Tirupathi electronics Ltd, Produces a standard product and provides
you the following information for the year ending 31st march,2010
Particulars Rs
Opening Stock of Raw Materials 10000
Purchases 85000
Closing Stock 4000
Direct Wage 20000
Other direct expenses 10000
Factory overheads 100% of direct wages
Office overheads 10% of work cost
Selling expenses Rs.2 per unit
FG- opening stock 1000 units Rs. 16000
Produced during the year 10000 units
Closing stock 2000 units
Prepare cost sheet for the year ending 31st March 2010. Also ascertain the Selling price per unit sop as to yield the profit of 20% on the selling price.
Solution:- Cost sheet Particulars Rs Total Cost Cost Per Unit
Opening Stock of Material Consumed
Direct WagesOther direct expenses
Prime CostFactory overheads
(100% Direct Wages)
Factory CostOffice & Admn
overhead10/100*14100
Office costAdd- opening stock of
FGLess- closing
stock(2000units@rs.15.51)
Cost of goods sold
910002000010000
121000
20000141000
14100
155100
1600017110031020
14080
9.102.001.00
12.10
2.0014.10
1.41
15.51
Particulars Rs Total Cost Cost Per Unit
Selling & distribution overheads
9000units @ rs.2/- PU
Cost of salesProfitSales
18000
15808039520
197600
Selling price per unit= 197600/9000= Rs.21.96
Working note:-Calculation of Unit Sold Opening Stock of FG 1000Add- Produced during year 10000Less- Closing Stock of FG 2000Unit Sold 9000
Calculation of Profit
Selling Price = Cost Price + Profit 100= 80+20 158080*20/80= 39.520
Problem 3: pg 43
The following details have been obtained from the cost records of comet paints ltd.
Particulars Rs
Stock of RM on 1-9-2010 75000
Stock of RM on 30-9-2010 91500
Direct Wages 52500
Indirect Wages 2750
WIP on1-9-2010 28000
WIP on 30-9-2010 35000
Purchase of RM 66000
Factory rent, Rates and Power 15000
Depreciation on P& M 3500
Carriage on purchases 1500
Office rent and taxes 2500
Stock of FG on 30-9-2010 31000
Stock on FG 1-9-2010 54000
It is estimated that the Selling & distribution overhead is 10% of sales and profit is 10% on sales. Prepare the cost sheet giving the maximum breakup of cost and profit.
Solution:- Cost sheet Particulars Rs Rs
Opening stock of RMAdd- Purchase of RM
Carriage inwards
Less- closing stock of RMCost of material
Direct wagesPrime cost
Factory Overheads:-Indirect wages
Factory rent, rates& powerDepreciation on plant
Add- opening Stock of WIP
Less- closing Stock of WIPWorks Cost
Office & Administrative overhead – office rent
Office Cost
75000660001500
14250091500
2750150003500
5100052500
103500
2125012475028000
15275035000
117750
2500120250
Particulars Rs Rs
Add- opening stock of FG
Less- closing stock of FGCOGS
Selling & DistributionCost of Sales
Profitsales
5400017425031000
14325017906
16115617906
179062
Working Notes;-Let SP 100Less- Profit 10% 10Cost of sales 90Less- selling & Distribution 10--------- 10% on saleCP 80 Calculation of Selling & Distribution overheadsCP+ profit= Cost of Sales80+10=9010/80*143250=17906
Calculation of profitSP= CP+ Profit= 100= 90+1010/90*161156(i.e. cost of sales)
Problem 4: pg 50
The following fig are extracted from the books of factory after the close of the year:
Particulars Rs.
Opening Stock 14000
Purchases during the year 100000
Closing Stock 10000
Direct Wages 20000
Work Overhead -50% on direct wages Stores overhead on materials- 10% on the cost of materials10% of the casting were rejected being not upto specification and a sum of Rs. 800 was realised on sale of scrap.10% of the finished castings were found to be defective in manufacture and were rectified by expenditure of a additional works overhead charged to the extent of 20% on the proportionate direct wages.The total gross output of costing during the year 2000 tons. Find out the manufacturing cost of the saleable casting per ton.
Solution:- Cost sheet Particulars Quantity RS RS
Opening Stock of RM+ Purchases
-Closing stock of RMCost of materials Consumed
Direct wagesPrime Cost
Work Overhead- 50% of Direct wages
stores Overhead- 50% of Direct materials
Total cost of gross output-Sales of rejected costingCost of finished Costing
Additional cost of rectifyingManufacturing Cost
2000200
1800---
1800
1400010000010000
10400020000
124000
10000
10400144400
800143600
360143960
Working Note: Cal of cost of rectification20/100of proportionate wages is the additional cost i.e. 20/100*20000=4000.For 2000 tons the cost is Rs.4000 therefore, 180tons=?180*20/100= 360
Problem 5: pg 51
Prepare a cost sheet showing cost and profit for 1000 bricks
Particulars Rs.
Fuel (coal) 2500kgs@ Rs. 15per kg
Wages 10 laborers for 150days @Rs.50 per day
Royalties 0.75 per 1000 bricks
Depreciation on equipment @10% on Rs. 150000
Handling charges 0.50 per 1000 bricks
Work expenses 10% of wages and coal
Administrative expense 5% of wages and coal
Bricks made 5200000
Stock on 1-1-2010 100000@Rs. 40 per 1000
Stock on 30-6-2010 1100000
Actual breakage 200000
Bricks sold 4000000 @ Rs.50 per 1000
Production data
Solution:- Cost sheetParticulars Cost per 1000 bricks Total cost for 5000000
Coal: 2500kgs@ Rs.15 per kg 7.50 37500
Wages: 10*150*50 15.00 75000
Royalty 0.75 3750
Prime cost 23.25 116250
Works exp- 10% of wages & coal
2.25 11250
Handling Charges 0.50 2500
Dep- 10% on Rs. 150000 3.00 15000
Work Cost 29.00 145000
Administrative exp- 5% of wages & Coal
1.125 5625
Cost of Production 30.125 150625
+ Opening stock 4000
- Closing stock 33138
Cost of bricks sold 121487
Profit 78513
Sales 200000
THANK YOU!!!!