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COST SHEET

CA. SURAJ WADHWA

Q No 1 The following figures are extracted from the Trial balance of GOGETTER CO. on 30th September, 1990. Inventories: Finished Goods 80,000 Raw Materials 1,40,000 Work in process 2,00,000 Office Appliances 17,400 Plant and Machinery 4,60,500 Buildings 2,00,000 Sales 7,68,000 Sales Return and Rebates 14,000 Materials purchased 3,20,000 Freight incurred on materials 16,000 Purchase Returns 4,800 Direct Labour 1,60,000 Indirect Labour 18,000 Factory Supervision 10,000 Repairs and Upkeep factory 14,000 Heat, Light and Power 65,000 Rates and Taxes 6,300 Miscellaneous Factory Expenses 18,700 Sales Commission 33,600 Sales Travelling 11,000 Sales promotion 22,500 Distribution Deptt. Salaries and Expenses 18,000 Offices Salaries and Expenses 8,600 Interest on Borrowed Funds 2,000 Further details are available as follows:(i) Closing Inventories: Rs. Finished Goods 1,15,000 Raw Materials 1,80,000 Work-in-process 1,92,000 (ii) Accrued Expenses on: Direct Labour 8,200 Indirect Labour 1,200 Interest on Borrowed Funds 2,000 (iii) Depreciation to be provided on: Office Appliances 5% Plant and Machinery 10% Buildings 4% (iv) Distribution of the following costs: Heat, Light and Power, to factory, office and Distribution in the ratio 8:1:1. Rates and Taxes two-thirds to Factory and one-third to Office.

Depreciation on Buildings to Factory, Office and Selling in the ratio 8:1:1. With the help of the above information, you are required to prepare a condensed Profit and Loss Statement of Gogetter Co. for the year ended 30th September, 1990 along with schedules of: (i) Cost of Sales (ii) Selling and Distribution Expenses Administration Expenses

Q NO 2 AJAY, BHARAT AND CHETAN are partners doing, business as engineers sharing profit and losses in the ratio of 2 : 1 : 1 respectively. Ajay is a sleeping partner, Bharat looks after the factory and Chetan looks after the administration. The following figures are extracted from their books for the year ended 30th June, 1985. Rs. Raw materials purchased 5,00,000 Wages : Direct 3,00,000 Indirect 50,000 Office salaries 1,00,000 Carriage Inward 10,000 Carriage outward 30,000 Sales 20,00,000 Opening Stock: Raw materials 2,00,000 Finished goods 50,000 Traveling expenses 10,000 Advertising 30,000 Power 10,000 Agents Commission 50,000 Plant maintenance 40,000 Rent, Rates, Taxes etc. (for building) 10,000 Sundry Expenses: Works 10,000 Office 20,000 Building repairs 10,000 Salary to partners: Bharat 20,000 Chetan 10,000 Depreciation: Plant and Machinery 20,000 Building 10,000 Closing stock: Raw materials 2,00,000 Finished goods 30,000 Building is occupied 9/10, by factory and 1/10 by office. You are required to prepare a detailed cost statement assuming that 1,00,000 units were produced during the year.

MARGINAL COSTING

CA. SURAJ WADHWA

Q NO 1 From the following information, calculate the break-even point and turn over required to earn of profit of Rs.30,000. Rs. Fixed overheads 21,000 Variable costs 2 per unit Selling price 5 per unit If the company is earning a profit of Rs.30,000, express the margin of safety available to it. Q NO 2 You are given the following data for the coming year for DG Ltd. Rs. Budgeted output 80,000 units Fixed expenses 4,00,000 Variable expenses per unit 1,000 Selling price per unit 2,000 If the selling price is reduced to Rs.18 per unit, what will be the new breakeven point?

Standard Costing

Q NO 1 The standard cost of a chemical mixture is given as under : 8 tonnes of material X @ Rs.40 per tonne. 12 tonnes of material Y @ Rs.60 per tonne. Standard yield is 90% of input. Actual cost for the period is as under : 10 tonnes of material X @ Rs.30 per tonne. 20 tonnes of material Y @ Rs.68 per tonne. Actual yield is 26.5 tonnes. Compute: a) Material cost variance, b) Material price variance, c) Material usage variance,

Q NO 2 The standard hours and time rate for unit component A are given below : Standard hours per unit : 15 Standard rate : Rs.4 per hour. Actual data and related information are as under : Annual production : 1,000 units Actual hours : 15,300 hours Actual rate : Rs.3.90 per hour. Calculate (a) Labour cost variance, (b) Labour efficiency variance, and (c) Labour rate variance