IMustration 3:

Swadeshi Electronics Ltd. furnishes you the following information for the vear ended 3ts

March, 2006:
Production and Sales 15,000 units
Sales Rs 12,75,000
Direct Wages Rs. 2,70,000
Direct Materials Rs. 3,30,000
Factory Overheads Rs. 2,25,000
Administrative Overheads Rs 1,05,000
SalesOverheads Rs 90,000
On account of intense competition following changes are estimated in the subsequet year
(a) Production and sales activity will be increased by one third.
(b) Material rate will be lower by 25%. However there will be increase in consumption Dy20
due to quality difference.
(c) Direct wages cost would be reduced by 20% due to automation.
factoy
(d) Out of the above factory overheads, Rs. 45,000 are of fixed nature. The
remain9
expenses are variable in proportion to the number of units produced.
Cost Sheet 247

e Total administrative overheads will be lower by40%

Sales overheads per unit would remain thesame.
g Sale price per unit would be lower by 20%.
Prepare a statement of cost for both the years ending 31st March,2006 and 31st March, 2007
showing maximum possible details of cost.
 From thefollowing data, prepare a cost sheet for the year 2015.
Particulars Rs.
Opening Stock of Raw Materials 3,00,000
Purchases 8,00,000
Closing Stock of Raw Materials 4,00,000
Carniage Outward 50,000
248 Vipul'sTM Introduction to Cost Accounting (BMS)
Wages Direct 7,00,000
Wages Indirect 1,00,000
Chargeable Expenses 2,00,000
Rent and Rates: Factory 40,000
Office 5,000
Indirect Materials 15,000
Drawing Office Salaries 10,000
Depreciation: Plant 5,000
Office Furniture 1,000
Salary: Office 25,000
Salesmen 20,000
W.I.P.: 1-1-2015 20,000
31-12-2015 10,000
Sale of by Product 10,000
Other Factory Expenses 57,000
Other Office Expenses 9,000
Managing Director's Remuneration 1,20,000
Other Selling Expenses 10,000 tNo
Art Work Charges 40,000
Stock of Finished goods: 1-1-2015 10,000 dertis
31-12-2015 50,000 ag
Travelling Expenses of Salesmen 11,000 ing
Carriage Inward 10,000
Sales
25,00,000 Pr
Advance Income Tax paid
1,50,000
Advertisement 20,000
M.D.s remuneration to be allocated as Rs. 40,000 to factory, Rs. 20,000 to office and Rs. ust
60,000 to sales. Hine
Solution: artm
 Hindustan Machine Tools Ltd. funishes for March, 2006 the following information for a
department:
Deluxe wrist watches manufactured 1,000 pieces.
Costand other data Rs.
Opening stock
Raw materials
4,50,000
Finished goods
3,30,000
(200 pieces)
Closing stock
Raw materials 5,00,000
Finished goods (300 pieces) ?
Purchases of raw material
7,00,000
Directlabour 4,00,000
Indirect labour factory 1,00,000
Consumption of stores and spares 90,000
Sales 19,80.000
Other overheads Factory Office Sales
depot
Rs. Rs. Rs.
Salary 1,00,000 2,00,000 1,50,000
Electricity 25,000 2,000 10,00
Stationery and Printing 10,000 25,000 20,00
Travelling expenses 3,000 10,000 50,00
Rent 5,000 5,000 5,000
Show room and Exhibition 10,000
expenses
Wiscellaneous expenses 15,000 25.000 20,000
The stock offinished
goods is valued at current month's cost of production.
CostS h e e t

251
lustration 6:
Collowing is the Profit and Loss AccOunt for the year ended 31st March, 2015 of M/s.
fots Ltd
Comforts manutacturers of Table Fans. They manufactured and sold
Lid., manufactu Cool and
theduring year 2000
fans
Profit and Loss Account for the year ended 31st
Dr. March, 2015 Cr
Particulars Rs. Particulars
To Materials Consumed 1,20,000 By Sales
Rs.
1,80,000
6,00,000
ToWages
ToManufacturing Expenses 75,000
ToGross Profit cld 2,25,000
Rs. 6,00,000 Rs. 6,00.000
To Rent, Rates and Taxes 15,000 By Gross Profit b/d 2,25.000
To General Expenses 30,000
ToManagement Expenses 90,000
ToSales and Distribution Expenses 45,000
To Net Profit 45,000
Rs. 2,25,000 Rs. 2,25,000
Their estimates for the next year ending 31st March 2016 are as under:
(1) The production and sales would increase to 3000 fans.
(2) The prices of materials per fan would increase by 20%.
(3) The labour cost per fan would go up by 10%.
(4) The manufacturing expenses would remain in the same proportion to materials consumed
and wages as in the previous year.
5) The selling and distribution expenses per fan would remain unchanged.
6) The other expenses would remain unaffected on account of increase in the production.
2015-2016 showing cost and profit per
Prepare a statement for the two years, 2014-2015 and
lan and total cost and total profit, giving maximum possible break-up of cost.
IHustration 7:
Dunkel Ltd. started a factory in Navi Mumbai on
1st April, 2005. Following details are furnished
2006:
about its activity during the year ended 31st March,
unit.
Raw Material consumed-40,000 units@Rs. 7 per
Direct Wages:
worker Rs. 6 per unit.
(a) Skilled worker Rs. 9 per unit. (b) Unskilled
unit.
Royalty (on raw material consumed)@Rs. 3 per
Works overheads@ Rs. 8 permachine hour.
Machine Hours worked 25,000.
Office Overheads at 1/3rd of works cost.
Sales Commission Rs. 4 per unit.
Units produced 40,000.
Stock of units at the end 4,000 units to be valued at cost of production per unit.
Sale price is Rs. 50 per unit.
Prepare Cost sheet showing the various elements of cost, both in total and per unit.
Illustration 8:
Prepare a cost sheet showing the total and per tonne cost of paper manufactured by Times
Paper Mills Ltd. for the month of March, 2006. There were 26 working days in the month. Also find
the profit earned by the company. The details are as under:
Direct Raw materials:
Paper pulp 6,000 tons Rs. 900 per tonne
Direct labour:
280 Skilled workmen Rs. 250 per day
300 Semiskilled workmen Rs. 150 per day
470 Unskilled workmen Rs. 100 per day
Direct expenses:
Special equipments hire charges Rs. 12,000 per day
Special dyes Rs. 250 per tonne of total raw material input
Work overheads: Variable 50% of direct wages
Fixed Rs. 2,70,000 p.m.
Administration overheads @12% of works cost
Selling and distribution overheads Rs. 80 per tonne sold.
Opening stock of paper 500 tonnes valued @ Rs. 2,501.60 per ton.
Closing stock of paper 300 tonnes valued at cost of production.
The paper is sold @ Rs. 3,000 per tonne.
 Illustration 9:
Fromthe following particulars prepare cost sheet. Rs.
Particulars
Raw Material 66,000
Productive Wages 70,000
Direct Expenses 6,000
Factory Rent& Taxes 15.000
21,000
Unproductive Wages 4,400
Factory Lighting
Factory Heating 3,000
Motive Power 8,800
Office Stationery 1,800
Haulage 6,000
Director's Fees (Works) 2,000
Directors Fees (Office) 4,000
Factory Cleaning 1,000
Sundry Office Expenses 400
Estimating 1,600
Factory Stationery 1,500
Water Supply 1,400
Drawing office Salary 1,000
Factory Insurance 2.200
Office Insurance 1,000
Legal Expenses 800
Rent of Warehouse 600
Depreciation on Plant & Machinery 4,000
Depreciation on Office Building 2.000
Depreciation on Delivery Vans 400
Bad Debts 200
Advertising 600
Sales Department Salaries 3,000
Upkeeping of Delivery Vans 1,400
Bank Charges 100
Commission on Sales 3,000
Loose Tools Written off 1,200
Rent&Taxes (office) 1,000
10,000
Output (tonnes)
 Illyastration 10:
VThe following information is available from a manufacturing industry during the four months
ended 31st March, 2014.
Particular
Raw Material Consumed Rs. 25,000
Direct Labour Rs. 20,000
Direct Expenses Rs. 15,000
Machine Hours Worked 800 Hours
Machine Hours Rate Rs. 25
Office on Cost 30% Work Cost
Selling on Cost Rs. 5/-Per Unit
Unit Produced 1,000
Unit Sold 800
Profit is 20% on Sales. You are required to prepare a cost sheet in respect of the above
showing: () The Cost Per Unit.(i) The Profit for the Period
oe
JHustration 11:
Fromthefollowing information prepare costsheet: Rs.
Particulars 5,00,000
Opening Stock- Raw Material
1,00,000
Work in process
Finished goods 4,00,000
Closing Stock- Finished goods 5,00,000
Work in Process 1,00,000
Raw Material 4,00,000
Purchase of Raw Materials 50,00,000
Donation 50,000
Direct Labour 20,00,000
Direct Expenses 2,00,000
Rent and taxes-Factory 2,50,000
Office 2,50,000
Fuel 2,00,000
Factory Insurance 1,00,000
Profit on sale of Machinery 20,000
Office salary 4,00,000
Sale of wastage 20,000
Office Insurance 50,000
Stationery 20,000
Salesmen salary 1,00,000
Carriage Inward 50,000
Carriage Outward 50,000
Cash discount 10,000
Commission received 1,00,000
Sales 100,00,000
Illustration 12
Mr. Nitin provides the following data relating to the manufacturing of one standard product
during the month of April 2015.
Particulars Amount (Rs.
Opening Stock of Raw Material 30,000
Raw Material Purchased 80,000
Carriage Inward 15,000
Closing Stock of Raw Material 20,000
Direct Labor Charges 80,000
Machine Hour Worked 1,000
Machine Hour Rate Rs.20
Administrative Overheads 10% On Works Cost
Selling Overheads Rs. 0.49 Per Unit
Unit Produced 50,000 Units
Units Sold 40,000 Units Rs.7.00 Per Unit.
You are required to prepare a Cost Sheet from the above showing:
(1) The Cost Per Unit. (2) Profit per unit sold and profit for the period.
Ilástration 13: the year ended 31st March,
Ltd. For
information of Ashtavinayak
From the following for the same period.
2006. You are required to prepare the Cost Sheet Amount(Rs.)
Particulars
Opening Stock 10,000
-Raw Material 5,000
-Work in Progress
- Finished Goods 20,000
1,00,000
Purchase of Raw Material
10,000
Cariage Inward
Closing Stock
- Raw Material 5,000
-Work in Progress
3,000
-Finished Goods 9,000
24.000
Wages 10,000
Royalty on Sale
Factory Expenses 13,500
Salesmen Salaries 10,000
20,000
Office and Administrative Expenses
Sales
Profit is20% on Sales
Illustration 14:
Fromthefollowing details prepare Cost Statement.
Particulars Amount
(Rs.)
Opening Stock of Raw Materials 72,000
Machinery (Original Cost) 80,000
Printing and Stationery 20,000
Bank Interest received 14,000
DirectWages 35,000
Raw Material Purchases 80,000
Office Expenses 26,000
Depreciation on Machinery 8,000
Commission on Sale 23,000
Opening Stock of Finished Goods 80,000
Closing Stock of Raw Materials 35,000
Sale of Scrap 12,000
Advertisement expenses 19,000
Closing Stock of Finished Goods 25,000
Sales 4,23,500
Sales Value
Illustration 15:
submitsthefollowing information on 31st March, 2008:
Titwala Manufacturing Company Rs.
Particulars 2,75,000
Sales for the year
Inventories at the beginning of the year were:
Finished goods 7,000
4,000
Works-in-progress 1,10,000
Purchase of raw materials for the year
Raw material at the beginning of the year 3,000
Raw material at the end of the year 4,000
Direct labour 95,000
Factory overhead was 60% of direct labour
Inventories at the end of the year were: boreho
Work-in-progress 6,000
Finished goods 8,000
Other expenses
Selling expense 10% of sales
Administrative expenses 8%of sales
Prepare a statement of cost.
Illustration 16:
The followingarethe particulars of AligatorManufacturing Ltd. for theyear ended 31/03/2014.
Particulars Rs.
Advertisement
Audit Fees
45,000
4,000
Director's remuneration 36,000
Direct wages
Lighting and heating:
12,75,000
Factory 15,000
Office 1,500
Materials consumed
11,25,000
Motive power 45,000
Miscellaneous office expenses 6,500
Office Salaries 52,500
Rent and rates:
Factory 75,000
Office 7,500
Delivery Van expenses 18,000
Salesmen's Salaries
30,000
You further given the following information:
are
Bad debts written off Rs. 5,000.
(i) Depreciation of Plant was Rs. 15,000 and Furniture Rs. 1,500.
(i) Total sales amounted to Rs. 45,00,000.
You are required to prepare a cost statement
showing: (a) prime cost, (b) works cost,
(c) cost of production (d) cost of calae (ol nrofit on cnnde cole
IHustration 17:
The following information is extracted from the books of M/s. Kripa Ltd. for the year ended
31-12-12. You are required to prepare a cost sheet showing relevant details of cost as wel as cost

perunit:
Amount Amount
Particulars Particulars
Rs. RS.
Direct Materials 12,00,000 Depreciation on Factory Building 7,500
Direct Wages 2,50,000 Branch Office Expenses 20,000
Insurance of Office Building 600 Depreciation on Office Building 4,000
Insurance of Factory Building 750 Depreciation on Staff Cars 6,000
Delivery van maintenance 5,000 Insurance of Staff Cars 750
Salary of Factory Chief Manager 12,500 Electricity (Including Rs. 4,000 for
Salary of Sales Manager 12,500 administrative office) et 9 20,000
Finished goods warehouse expenses 10,000 Advertisement 10,000
Sundry Factory Expenses 1,70,000 Office Administration expenses 25,000
Sales promotion 2,500 Expenses for participating in
Sales 21,00,000 industrial exhibition 5,000
Units Produced 10,000