[Cost Sheet Practical
Problems and Solutions, Cost Accounting, Cost Sheet Format, All
Universities of India, B.Com]
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In this post, you will get cost sheet practical problems and solutions which are asked Various B.Com Exams. Also go through Part 1 , Part 3 and Part 4 of cost sheet problems and solutions for more.
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Cost Sheet Practical Problems and Solutions (Part 2)
11. The accounts of the Steelways Engineering
Co. Ltd. show for 2010:
|
Rs. |
|
|
Materials used Manual and machine labour wages directly
chargeable Works overhead expenditure Establishment and general expenses |
1,80,000 1,60,000 40,000 19,000 |
a) Show the works cost and
total cost, the percentage that the works overhead cost bears to the manual and
machine labour wages and the percentage that the establishment and general
expenses bear to the works cost.
b) What price should the
company quote to manufacture a machine which, it is estimated will require an
expenditure of Rs. 8,000 on materials and Rs. 6,000 on wages so that it will
yield a profit of 25% on the total cost or 20% on selling price.
Ans:
Cost Sheet or
Statement of Cost
|
PARTICULARS |
AMOUNT |
|
Material used Manual and machine labour wages (Directly
chargeable) |
1,80,000 1,60,000 |
|
Prime Cost Work’s overhead expenditure |
3,40,000 40,000 |
|
Work’s Cost Establishment & General Expenses |
3,80,000 19,000 |
|
Total cost |
3,99,000 |
|
Percentage of works overhead to manual and
machine labour = (40,000/1,60,000*100) Percentage of establishment and general
expenses to work’s cost = (19,000/3,80,000*100) |
25% 5% |
Statement of Estimated Cost for the
Manufacture of the Machine Enquiry from:
|
PARTICULARS |
AMOUNT |
|
Cost of Materials Direct wages |
8,000 6,000 |
|
Prime Cost Works overhead (25% of wages) |
14,000 1,500 |
|
Work’s Cost Establishment and general expenses (5% of
work’s cost) |
15,500 775 |
|
Total Cost Profit (20% on selling price or 25% on cost) |
16,275 4,069 |
|
Price to be quoted |
20,344 |
12. From the following particulars prepare a
statement in such from as you consider most suitable for showing clearly all
element of cost:
|
Rs. |
Rs. |
||
|
Opening stock of raw materials Purchase of raw materials Raw materials returned to suppliers Closing stock of raw materials Wages paid to: Productive
workers Non-productive
workers Salaries paid to office staff Carriage on raw materials purchased |
25,000 70,000 2,000 18,800 18,000 2,000 5,000 500 |
Carriage on goods sold Rent and rates of workshop Fuel, gas and water etc. Repairs to plant Depreciation on machinery Office expenses Direct chargeable expenses Advertising Abnormal loss of raw materials |
1,500 2,500 1,000 600 1,400 1,500 800 1,200 1,200 |
Ans:
Cost Sheet or
Statement of Cost
|
PARTICULARS |
AMOUNT |
AMOUNT |
|
Material Consumed: Opening Stock Purchases Carriage on Purchases |
25,000 70,000 500 |
|
|
Less: Return |
95,500 2,000 |
|
|
Less: Abnormal loss |
93,500 1,200 |
|
|
Less: Closing Stock |
92,300 18,800 |
73,500 |
|
Productive Wages Direct chargeable expenses |
18,000 800 |
|
|
Prime Cost Work’s overheads: Non-productive wages Rent, rates of workshop Fuel, gas, water etc Repairs to plant Depreciation on Machinery |
2,000 2,500 1,000 600 1,400 |
92,300 7,500 |
|
Work’s Cost Office overheads: Salaries to Office staff Office expenses |
5,000 1,500 |
99,800 6,500 |
|
Cost of production Selling & distributing Overheads: Carriage on goods sold Advertising |
1,500 1,200 |
1,06,300 2,700 |
|
Cost of sales |
1,09,000 |
Note: Abnormal loss of materials should be
excluded from cost and debited to Costing profit and loss A/c, hence it has
been deducted from material
cost.
13. The following data relate to the
manufacture of a standard product during the four-week period to June 30th,
2011:
|
Particulars |
Rs. |
|
Raw materials consumed Wages Machine hours worked Machine hour rate Office overhead Selling overhead Units produced Units sold |
4,000 6,000 1,000 50
paise 20%
on works cost 6
paise per unit 20,000 18,000
@ Re. 1 per unit |
You are required to prepare a cost sheet
showing the cost per unit and profit for the period.
Ans:
Cost Sheet or Statement of Cost
Output – 20,000 units
Period: 4 weeks ended 30-06-11
|
PARTICULARS |
TOTAL
AMOUNT Rs. |
PER
UNIT Rs. |
|
Raw Material consumed Wages |
4,000 6,000 |
0.200 0.300 |
|
Prime Cost Add: Work’s overhead: 1,000 hours @ Re. 50 |
10,000 500 |
0.500 0.025 |
|
Work’s Cost Add: Office overhead: (20% of Work’s Cost) |
10,500 2,100 |
0.525 0.105 |
|
Cost of Production Less: Closing Stock (2,000 units @ Re.
0.630) |
12,600 1,260 |
0.630 |
|
Cost of goods sold (18,000 units) Add: Selling overhead: 0.60 per unit on 18,000 units |
11,340 1,080 |
0.630 0.060 |
|
Cost of sales Profit (Balancing figure) |
12,420 5,580 |
0.690 0.310 |
|
Sales |
18,000 |
1.000 |
14. From the following particulars you are
required to prepare a monthly cost sheet of a manufacturing company showing
cost and profit per 1,000 units of production. Show also in the form of a
summary the cost of sales, net profit and sales for the month. The company
manufacturers’ only one type of product. The opening stock was valued at the
same price per 1,000 units as the production of the month concerned.
|
Particulars |
Amount |
|
Materials: Basic raw
materials Stores Labour: Direct Indirect Overheads: Works Office Production for the month of November, 2010 Sales for the month Stock at the beginning of the month Stock at the end of the month |
1,400
tonnes @ Rs. 5 per ton Rs.
5,000 16,000 3,000 25%
of direct labour 10%
of works cost 10,00,000
units 9,00,000
units @ Rs. 50 per 1,000 units 2,00,000
units 3,00,000
units |
Ans:
Cost Sheet or Statement of Cost
|
PARTICULARS |
TOTAL
AMOUNT |
UNIT |
|
Basic raw materials: 1,400 tonnes @ Rs. 5
per tones Direct Labour |
7,000 16,000 |
700 1,600 |
|
Prime Cost Indirect materials Indirect Labour Work’s overhead (25% of direct labour) |
23,000 5,000 3,000 4,000 |
2,300 500 300 400 |
|
Work Cost Office overhead (10% of work’s cost) |
35,000 3,500 |
35.00 3.50 |
|
Cost of production Add: Opening Stock: 2,00,000 unit @ Rs.
38.50 per thousand unit |
38,500 7,700 |
38.50 |
|
Less: Closing Stock: 3,00,000 unit @ Rs.
38.50 per thousand unit |
46,200 11,550 |
|
|
Cost of goods sold (9,00,000 units) Profit (Balancing figure) |
34,650 10,350 |
11.50 |
|
Sales |
45,000 |
50.00 |
15. The following figures for the month of
April, 2011 were extracted from the records of a factory:
|
Rs. |
|
|
Opening stock of finished goods (5,000
units) Purchase of raw materials Direct wages Factory overhead Administration overhead Selling and distribution overhead Closing stock of finished goods (10,000
units) Sales (45,000 units) |
45,000 2,57,100 1,05,000 100%
of direct wages Re.
1 per unit 10%
of sales ? 6,60,000 |
Prepare a cost sheet for the month of April,
2011, assuming that sales are made on the basis of ‘first-in-first-out’
principle.
Ans:
Statement of cost
Output: 50,000
units (See Note – 1)
Period: April,
2011
|
PARTICULARS |
TOTAL
AMOUNT Rs. |
PER
UNIT Rs. |
|
Raw Material Direct Wages |
2,57,100 1,05,000 |
5.142 2.100 |
|
Prime Cost Add: Factory Overhead (100% of direct wages) |
3,62,100 1,05,000 |
7.242 2.100 |
|
Work’s Cost Add: Administration overhead (Re. 1 per
unit) |
4,67,100 50,000 |
9.342 1.000 |
|
Cost of production Add: Opening Stock of finished goods |
5,17,100 45,000 |
10.342 |
|
Less: Closing Stock of finished goods
(10,000 units @ Rs. 10.342) (See Note 2) |
5,62,100 1,03,420 |
|
|
Cost of goods sold (45,000 units) Add: Selling and distribution overhead @ 10%
of sales |
4,58,680 66,000 |
1.467 |
|
Cost of Sales Profit (Balancing figure) |
5,24,680 1,35,320 |
11.809 2.858 |
|
Sales (See Note – 3) |
6,60,000 |
14.667 |
Note – 1: Production during the month: [Sales
45,000 unit + closing stock 10,000 units – opening stock 5,000 units] = 50,000
units.
Note – 2: Since goods have been sold on FIFO
basis the entire closing stock represents current
production @
Rs. 10.342 per unit, because sales include all opening stock and part of
current production.
Note – 3: Per unit sale Rs. 14.667 has been
obtained by dividing Rs. 6,60,000 by 45,000 sales units.
16. The Tripati Electricals Ltd.
manufacturers’ one product. A summary of its activities for 2010 is as follows:
|
Particulars |
Units |
Rs. |
|
Sales Material inventory: 1.1.10 31.12.10 Work-in-progress inventory: 1.1.10 31.12.10 Finished goods: 1.1.10 31.12.10 Material purchases Direct labour Manufacturing overheads Selling expenses General and administration expenses |
80,000 16,000 24,000 |
8,00,000 40,000 32,000 55,000 72,000 64,000 - 1,52,000 1,45,000 1,08,000 50,000 40,000 |
Prepare a cost sheet showing:
a) The total cost of goods
manufactured (finished), the number of units manufactured (finished) and the
cost per unit; and
b) The cost of goods sold for
the year presuming the company uses the LIFO inventory costing method for its
finished goods inventory.
Ans:
Statement of cost
Output: 88,000
units (See Note – 1)
Period: Year
ended 5/12/10
|
PARTICULARS |
TOTAL
AMOUNT Rs. |
PER
UNIT Rs. |
|
Materials Consumed: Opening
Inventory 40,000 Purchases 1,52,000
1,92,000 Less: Closing
inventory 32,000 Add: Direct labour |
1,60,000 1,45,000 |
1.81818 1.64773 |
|
Prime Cost Add: Manufacturing overhead: |
3,05,000 1,08,000 |
3.46591 1.22727 |
|
Adjustment for work-in-progress Opening 55,000 Closing (-)
72,000 |
4,13,000 (-)17,000 |
4.69318 (-)0.19318 |
|
Work Cost Add: General and Administration expenses: |
3,96,000 40,000 |
4.50000 0.45455 |
|
Total Cost of goods manufactured Add: Opening Stock (16,000 units) |
4,36,000 64,000 |
4.95455 |
|
Less: Closing Stock (24,000 units) (See Note
– 2) |
5,00,000 1,03,636 |
|
|
Cost of goods sold (80,000 units) Add: Selling and Distributive overhead |
3,96,364 50,000 |
0.625000 |
|
Cost of sales Profit (Balancing figure) |
4,46,364 3,53,363 |
5.57955 4.42045 |
|
Sales |
8,00,000 |
10.00000 |
Working Note: Note – 1: Production during the
month: (Sales 80,000 units + closing stock 24,000 units – opening stock 16,000
units) = 88 units.
Note – 2: Value of closing stock on LIFO
basis:
|
Rs. |
|
|
16,000 units @ Rs. 4 per unit 8,000 units @ Rs. 4.95455 per unit |
64,000 39,636 |
|
1,03,636 |
17. The books of manufacturing company present
the following data for the month of April, 2011: Direct labour cost Rs. 17,500
being 175% of works overhead. Cost of goods sold excluding administrative
expenses Rs. 56,000. Inventory accounts showed the following opening and
closing balances:
|
April 1 Rs. |
April 30 Rs. |
Rs. |
|
|
Raw materials Work-in-progress Finished goods Other data are: Selling expenses General and administration expenses Sales for the month |
8,000 10,500 17,600 |
10,600 14,500 19,000 |
3,500 2,500 75,000 |
You
are required to:
1.
Compute
the value of raw materials purchased; and
2.
Prepare
a cost statement showing the various elements of cost and also the profit
earned.
Ans:
Cost Sheet or
Statement of Cost
|
PARTICULARS |
TOTAL
AMOUNT Rs. |
|
Opening stock of Raw Material Add: Purchases (Note – 1) Less: Closing Stock of raw material |
8,000 36,500 10,600 |
|
Raw material consumed during the year Add: Direct Labour |
33,900 17,500 |
|
Prime Cost Add: Works overhead: |
51,400 10,000 |
|
Adjustment for work-in-progress: Opening 10,500 Closing (-)
14,500 |
61,400 (-)
4,000 |
|
Works cost or cost of production Add: Opening stock of finished goods |
57,400 17,600 |
|
Less: Closing stock of finished goods |
75,000 19,000 |
|
Cost of goods sold Add: General and administration expenses Add: Selling expenses |
56,000 2,500 3,500 |
|
Profit (Balancing figure) |
62,000 13,000 |
|
Sales |
75,000 |
Note – 1: Statement computing the value of Raw
materials purchased
|
Cost of goods sold Add: Closing Stock of finished goods |
56,000 19,000 |
|
Less: Opening stock of finished goods |
75,000 17,600 |
|
Work Cost or Cost of production Add: Closing Stock of work-in-progress |
57,400 14,500 |
|
Less: Opening Stock of work-in-progress |
71,900 10,500 |
|
Less: Works overhead: (100/175*17,500) |
61,400 10,000 |
|
Prime Cost Less: Direct Labour |
51,400 17,500 |
|
Raw Materials consumed Add: Closing Stock of raw materials |
33,900 10,600 |
|
Less: Opening Stock of raw materials |
44,500 8,000 |
|
Value of Raw materials purchased |
36,500 |
18. A factory produces and sells 1,000 units
of a product in July, 2011, for which the following particulars are available:
|
Particulars |
Rs. |
|
Stock of direct materials on 1.7.11 Purchase and receipt of direct materials in
July, 2011 Direct wages paid in cash in July, 2011 (which includes Rs. 3,000 on account of June
2011 and an advance of Rs. 2,000) Works overhead charges for the month Stock of direct materials on 31.7.11 Administration and selling overheads Sales price |
6,000 1,44,000 55,000 60,000 10,000 Rs.
25 per unit Rs.
300 per unit |
From the above particulars you are required
to:
a) Prepare
a cost statement for July, 2011; and
b) Estimate
the sale price of a unit of the same product in August, 2011, assuming: (i) 20%
increase in direct materials cost; (ii) 10% increase in direct wages; (iii) 5%
increase in works overhead charges; (iv) 20% reduction in administration and
selling overhead charges; and (v) same percentage of profit on sales price as
in July, 2011.
Ans:
Cost Sheet
Output: 1,000
units (See Note – 1)
Period: July,
2011
|
PARTICULARS |
TOTAL
AMOUNT Rs. Rs. |
COST
PER UNIT Rs. |
|
|
Materials Consumed: Stock as on 1-7-11 Purchases during the month |
6,000 1,44,000 |
||
|
Less: Stock as on 31-7-11 |
1,50,000 10,000 |
1,40,000 |
140 |
|
Direct Wages (paid In July) Less: Payment for June |
55,000 3,000 |
||
|
Less: Advance payment |
52,500 2,000 |
50,000 |
50 |
|
Prime Cost Add: Works overhead |
1,90,000 60,000 |
190 60 |
|
|
Works cost or Cost of Production Add: Administration and selling overheads @
Rs. 25 per unit |
2,50,000 25,000 |
250 25 |
|
|
Cost of Sales Profit (Balancing figure) |
2,75,000 25,000 |
275 25 |
|
|
Selling Price @ Rs. 300 [Seen Note – 1] |
3,00,000 |
300 |
|
Estimate of Selling Price per unit in August,
2011
Note – 1:
|
Direct Materials: (120/100*140) Direct Wages: (110/100*50) Prime Cost Works Overhead: (105/100*60) |
168.00 55.00 223.00 63.00 |
|
Works Cost or Cost of Production Administration and Selling overhead:
(80/100*25) |
286.00 20.00 |
|
Cost of Sales Profit [@8.33% on sales or 1/12th of
sales or 1/11th of cost] [See Note – 2] |
306.00 27.82 |
|
Selling Price |
333.82 |
Working Note: Ratio of Profit to sales in
July, 2011 = (25,000/3,00,000*100) = 1/12th or 8.33%
19. The following figures are extracted from
the books of an iron foundry after the close of the year:
|
Rs. |
|
|
Raw Materials: Opening stock Purchase
during the year Closing stock Direct wages Works overhead Stores overhead on materials |
14,000 1,00,000 10,000 20,000 50%
on direct wages 10%
on the cost of materials |
10% of the castings were rejected being not up
to specification and a sum of Rs. 800 was realised from sale of scrap, 10% of
the finished castings were found to be defective in manufacture and were
rectified by expenditure of additional works overhead charged to the extent of
20% on proportionate direct wages. The total gross output of castings during
the year: 2,000 tons. Find out the manufacturing cost of the saleable castings
per ton.
Ans:
Cost Sheet or
Statement of Cost
|
PARTICULARS |
TOTAL
AMOUNT |
|
Materials Used: Opening
Stock 14,000 Purchases 1,00,000 1,14,000 Less: Closing
Stock 10,000 Direct Wages |
1,04,000 20,000 |
|
Prime Cost Work overhead: 50% of direct wages Stores overhead: 10% of material cost |
1,24,000 10,000 10,400 |
|
Less: Sale of scrap: 200 tons (i.e. 10% of
gross output) |
1,44,000 800 |
|
Add: Cost of rectification of defective
works: 180 tons (i.e. 10% of net output) @ Rs. 2 per ton [Note – 1] |
1,43,600 360 |
|
Manufacturing cost of 1,800 tons saleable
castings |
1,43,960 |
|
Cost per ton (approx) |
80.00 |
Working Note: Cost of rectification
of defective works per ton:
Direct Wages per ton = (20,000/2,000 = 10)
Rectification cost: 20% of Rs. 10 = Rs. 2
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