Jain and Narang's Book Solved Practical Problems | Cost Sheet Problems and Solutions | Part 1

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 in Jain and Narangs’ Book (Part 1). Also go through Part 2 , Part 3 and Part 4 of cost sheet problems and solutions for more.

You can also go through my comprehensive article on Cost Sheet Format. 

JAIN AND NARANG’S BOOK PRACTICAL PROBLEM SOLVED

Solution of Problem No. 1

Cost Sheet or Statement of Cost

PARTICULARS

AMOUNT

AMOUNT

Raw Materials

Add: Productive Wages

33,000

38,000

(a) Prime Cost

Add: Factory Overhead:

Unproductive wages

Factory rent and taxes

Factory lighting

Factory heating

Motive power

Haulage (works)

Director’s Fees (works)

Factory cleaning

Estimating expenses (works)

Factory stationery

Water supply (works)

Factory insurance

Depreciation of Plant & Machinery

Loose Tools written off

 

 

10,500

7,500

2,200

1,500

4,400

3,000

1,000

500

800

750

1,200

1,100

2,000

600

71,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

37,050

(b) Factory Cost

Add: Office and administrative overhead:

Director’s fees (Office)

Sundry office expenses

Office stationery

Office Insurance

Legal expenses

Depreciation on office Building

Rent and Taxes (office)

Bank charges

 

 

2,000

200

900

500

400

1,000

500

50

1,08,050

 

 

 

 

 

 

 

 

5,550

(c) Cost of production

Add: Selling & Distribution overhead:

Rent of warehouse

Depreciation on Delivery vans

Bad debts

Advertising

Sales department’s salaries

Un of delivery vans

Commission of sales

 

 

300

200

100

300

1,500

700

1,500

1,13,600

 

 

 

 

 

 

 

4,600

Total Cost

1,18,200

Cost per ton = 1,18,200/14,775 = Rs. 8 per ton

Solution of Problem No. 2

In the Books of Z Manufacturing Company

Cost Sheet

PARTICULARS

AMOUNT

AMOUNT

Raw Material Consumed:

Opening Stock

Purchases

Carriage on purchases

Less: Closing Stock of Raw Materials

 

62,800

1,85,000

7,150

48,000

(a) Raw Materials consumed during the year

Productive wages

2,06,950

1,26,000

(b) Prime Cost

Works overheads:

Factory Office salaries

Repairs of plant, machinery & tools

Rent, rates, taxes & insurance

Depreciation on plant, machinery and tools

Gas and water

Manager’s salary

 

 

6,500

4,450

8,500

6,500

1,200

7,500

3,32,950

 

 

 

 

 

 

34,650

(c) Factory Cost

Administrative Overheads:

General Office salaries

Rent, rates, taxes & insurance

Depreciation on furniture

Director’s fees

Manager’s salary

General expenses

Gas and water

 

 

12,600

2,000

300

6,000

2,500

3,400

400

3,67,600

 

 

 

 

 

 

 

27,200

(d) Cost of production

Selling & distributive Overheads:

Carriage outward

Bad debts written off

Travelling expenses

Traveler’s salaries & commission

 

 

4,300

6,500

2,100

7,700

3,94,800

 

 

 

 

20,600

(e) Total Cost

Net Profit

4,15,400

45,700

(f) Sales

4,61,100

 

Solution of Problem No. 3

Ans:

Cost Sheet of sunshine Industries Ltd.

For the year 2012

PARTICULARS

AMOUNT

AMOUNT

Opening Stock of Raw Material

Add: Purchases

Add: Carriage inward

Less: Closing Stock of Raw Materials

25,000

85,000

5,000

40,000

(a) Raw Material Consumed during the year

Add: Direct wages

75,000

90,000

(b) Prime Cost

Add: Factory Overheads:

Wages (Indirect)

Rent & Rates

Depreciation on Plant & Machinery

Indirect consumption of Material

Other Factory expenses

Manager’s Remuneration

 

 

10,000

5,000

1,500

500

5,700

4,000

1,65,000

 

 

 

 

 

 

26,700

(c) Work’s Cost

Add: Office and Administrative Overhead:

Rent & Rates

Depreciation on office furniture

Salary

Other office expenses

Manager’s Remuneration

 

 

500

100

2,500

900

2,000

1,91,700

 

 

 

 

 

6,000

(d) Cost of Production

Add; Selling & distributive overhead:

Salary of salesmen

Manager’s Remuneration

Advertisement expenses

Travelling expenses of salesmen

Carriage and Freight outward

Bad debts written off

 

 

2,000

6,000

2,000

1,100

1,000

1,000

1,97,700

 

 

 

 

 

 

13,100

(e) Cost of sales

(f) Profit (Balancing figure)

2,10,800

39,200

Sales

2,50,000

 

Solution of Problem No. 4

Cost Sheet

For the month of September, 2012

PARTICULARS

AMOUNT

Raw Materials (Opening)

Add: purchase of Raw Materials

Less: Raw Materials (closing)

1,00,000

88,000

1,23,500

Raw Materials consumed

Add: Direct wages

64,500

70,000

Prime Cost

Add: Work’s overheads:

Less: Sale of Factory scrap

1,34,500

39,500

2,000

Work’s Cost incurred

Add: Work-in-progress (Opening)

Les: work-in-progress (Closing)

1,72,000

31,000

34,500

Work’s Cost

Add: Office and administrative Overhead

1,68,500

13,000

Cost of Production

Add: Finished goods (Opening)

1,81,500

71,500

 

Less: Finished goods (Closing)

2,53,000

42,000

Cost of goods sold

Add: Selling and Distributive overhead:

Cost of goods sold

Profit (Balancing figure)

2,11,000

15,000

2,26,000

58,000

Sales

2,84,000

 

Solution of Problem No. 5

In the Books of Modern Manufacturing Company

Cost Sheet

PARTICULARS

AMOUNT

AMOUNT

Raw Material Consumed:

Opening

Purchases

Less: Closing Stock of Raw Materials

 

3,000

1,10,000

4,000

(a) Raw Materials Consumed during the year

Direct Labour

1,09,000

65,000

(b) Prime Cost

Works Overheads:

Factory overhead (60% of direct labour cost)

Add: Opening stock of work-in-progress

Less: Closing stock of work-in-progress

 

 

39,000

4,000

6,000

1,74,000

 

 

 

37,000

(c) Factory’s Cost

Administrative Overheads:

Administrative expenses (5% of sales)

2,11,000

 

13,750

(d) Cost of Production

Add: Opening stock of finished goods

Less: Closing stock of finished goods

2,24,750

7,000

8,000

(e) Cost of goods sold

Selling and Distributive Overhead:

Selling Expenses (10% of sales)

2,23,750

 

27,500

(f) Total cost

Net Profit

2,51,250

23,750

(g) Sales

2,75,000

 

Solution of Problem No. 6

In the Books of Manufacturing Company

Cost Sheet

PARTICULARS

AMOUNT

AMOUNT

Raw Material Consumed:

Opening Stock

Purchases

Less: Closing Stock of Raw Materials

 

40,000

4,00,000

50,000

(a) Raw Material consumed during the year

Direct Labour

3,90,000

3,00,000

(b) Prime Cost

Works Overheads:

Indirect Labour

Lubricants

Insurance on Plant

Power

Depreciation on Machinery

Factory Rent

Property for factory Building

 

 

50,000

10,000

3,000

30,000

50,000

60,000

11,000

6,90,000

 

 

 

 

 

 

 

2,14,000

(c) Factory cost incurred

Add: Opening Stock of work-in-progress

Less: Closing Stock of work-in-progress

9,04,000

10,000

14,000

(d) Factory Cost

Administrative Overheads:

Administrative Expenses

9,00,000

 

1,00,000

(e) Cost of Production

Add: Opening Stock of finished goods

Less: Closing Stock of finished goods

10,00,000

1,00,000

1,50,000

(f) Cost of goods sold

Selling and Distributive Overhead:

Sale Commission

Salaries of Salesman

Carriage outward

 

 

60,000

1,00,000

20,000

9,50,000

 

 

 

1,80,000

(g) Total Cost

Net Profit

11,30,000

70,000

(h) Sales

12,00,000

 

Solution of Problem No. 7

Statement Cost Sheet

PARTICULARS

AMOUNT

AMOUNT

Raw Material Consumed:

Opening Stock

Purchases

Carriage inward

 

 

30,000

1,20,000

 

Less: Closing Stock of Raw Materials

1,50,000

35,000

(a) Raw Material consumed during the year

Productive wages

1,15,000

90,000

(b) Prime Cost

Factory Overheads:

Indirect wages

Factory rent & rates

Plant repair

Depreciation on plant

Factory lighting

 

 

9,720

7,830

3,420

8,360

7,380

2,05,000

 

 

 

 

 

36,710

(c) Factory cost incurred

Add: Opening Stock of work-in-progress

Less: Closing Stock of work-in-progress

2,41,710

15,000

20,000

(d) Factory Cost

2,36,710

 

Income Statement

For the year ended on 31-12-2012

Particulars

Amount

Net Sales

Less: Cost of Goods Sold

Opening stock of finished goods                                                                                            43,700

Add: Factory cost                                                                                                                   2,36,710

                                                                                                                                                  2,80,410

Less: Closing stock of finished goods                                                                                    54,000

3,25,000

 

 

 

 

2,26,410

Gross Profit

Less: Operating Expenses

Office and Administrative overheads (15,030+13,500+2,000)                                           30,530                                                         

Selling and Distribution overheads (1,200+7,650)                                                                  8,850

98,590

 

 

39,380

Net Profit

59,210

 

Solution of Problem No. 8

Statement Cost Sheet

PARTICULARS

AMOUNT

AMOUNT

Raw Material Consumed:

Opening Stock

Purchases

Carriage inward

Less: Closing Stock of raw material

 

40,000

4,75,000

12,500

50,000

(a) Raw Material Consumed during the year

Wages

4,77,500

1,75,000

(b) Prime Cost

Factory Overhead:

Work’s manager’s salary

Factory employee’s salary

Factory rent, taxes, insurance

Power expenses

Other production expenses

 

 

30,000

60,000

7,250

9,500

43,000

6,52,500

 

 

 

 

 

1,49,750

(c) Factory cost incurred

Add: Opening stock of work-in-progress

Less: Closing Stock of work-in-progress

8,02,250

15,000

10,000

(d) Factory Cost

Administrative Overhead:

General Expenses

8,07,250

 

32,500

(e) Cost of Production

Add: Opening stock of finished goods

Less: Closing stock of finished goods

8,39,750

6,000

15,000

(f) Cost of goods Sold

Selling and Distribution Overhead:

Selling Expenses

8,30,750

 

9,250

(g) Total Cost

Net Profit

8,40,000

20,000

(h) Sales

8,60,000

 

Solution of Problem No. 9

In the books of a Manufacturing firm

PARTICULARS

AMOUNT

AMOUNT

Opening Stock of Raw Materials

Add: Purchases of Raw Materials

40,000

11,00,000

 

Less: Closing Stock of Raw Materials

11,40,000

1,40,000

(a) Raw Materials Consumed during the year

Add: Productive Wages

10,00,000

5,00,000

(b) Prime Cost

Add: Factory Overheads:

Work’s Overhead

15,00,000

 

1,50,000

(c) works/Manufacturing/Factory Cost

Add: Office and Administrative Overheads

16,50,000

1,00,000

(d) Cost of production

Add: Opening Stock of finished goods

Less: Closing Stock of finished goods

 

50,000

60,000

17,50,000

 

(10,000)

(e) Cost of goods sold /sales

Add: Profit

17,40,000

6,60,000

Sales

24,00,000

Working Note:

% of works overheads to Productive Wages = (1,50,000/5,00,000 * 100) = 30%

% of General overheads to Works Cost = (1,00,000/16,50,000*100) = 6.06%

 

Solution of Problem No. 10

Statement of Cost Sheet

PARTICULARS

UNIT

AMOUNT

Raw Material Consumed

Wages

15,000

9,000

(a) Prime Cost

Factory Overheads (900 x 5)

24,000

4,500

(b) Work’s cost

Administrative Overheads (28,500 x 20%)

28,500

5,700

(c) Cost of Production

Less: Closing Stock of finished goods

(34,200/17,100 = 2*1,100)

17,100

 

1,100

34,200

 

2,200

(d) Cost of goods sold

Selling & Distribution Overheads (16,000*0.5)

16,000

32,000

8,000

(e) Total Cost

Net Sales

16,000

40,000

24,000

Sales

16,000

64,000

Working Note: 

Cost of production per unit = (34,200/17,100 = 2)

Profit per unit = (24,000/16,000 = 1.50)

Solution of Problem No. 11

Statement of Cost

PARTICULARS

UNIT

AMOUNT

Raw Materials Consumed:

Opening Stock

Purchases

Less: Closing Stock of Raw Material

 

3,000

28,000

4,500

(a) Raw Material consumed during the year

Manufacturing wages

26,500

7,000

(b) Prime Cost

Work’s Overheads:

Factory rent & rates

Depreciation on plant

33,500

 

3,000

1,500

(c) Work’s Cost

Administrative Overheads:

Office rent

General Expenses

38,000

 

500

400

(d) Cost of production

Add: Opening stock of finished goods

Less: Closing Stock of finished goods  (38,900/3,000 = 12.97 * 400)

3,000

200

400

38,900

2,800

5,187

(e) Cost of goods sold

Selling & Distributive Overheads:

Advertisement Expenses

2,800

 

-

36,513

 

600

(f) Total Cost

Add: Net Profit

2,800

-

37,113

12,887

Sales

2,800

50,000

Working Note:  Total cost per ton = (Total Cost / Output during the year)

Solution of Problem No. 1 2

Statement of Cost Sheet

PARTICULARS

Orient (78)

Sujon (287)

Unit

Total

Unit

Total

Material

Wages

350

200

27,300

15,600

1,08,680

62,920

(a) Prime Cost

Add: Factory Overheads (80% on labour)

550

160

42,900

12,480

 

50,336

(b) Work’s Cost

Add: Office & Administrative Overhead

710

106.50

55,380

8,307

(c) Cost of production

Profit

816.5

183.50

63,687

14,313

(d) Sales

1,000

78,000

 

Solution of Problem No. 1 3

Cost Sheet

For the year 2012

PARTICULARS

AMOUNT

AMOUNT

Raw Materials Consumed during the year

Add: Direct Wages

12,00,000

10,00,000

Prime Cost

Add: Factory Overheads:

Indirect Labour in works

Storage of raw materials and spares

Fuel

Tools consumed

Depreciation on Plant

Salaries of works personnel

Excise duty on production

 

 

2,00,000

50,000

1,50,000

20,000

1,00,000

1,00,000

2,00,000

 

 

 

 

 

 

 

 

8,20,000

Factory Cost/Work’s Cost

Add: Office and Administrative Overhead:

Administrative office expenses

Salary of Managing Director

Fees of directors

Salary of joint Managing Director

 

 

2,00,000

60,000

20,000

40,000

30,20,000

 

 

 

 

3,20,000

Cost of Production

Add: Selling and Distributive Overheads:

Expenses on advertising

Selling Expenses

Sales depots

Packaging and distribution

 

 

1,60,000

1,80,000

1,20,000

1,20,000

33,40,000

 

 

 

 

5,80,000

Cost of sales

Add: Profit margin (20% on sales or 25% on cost)

39,20,000

9,80,000

Sales

49,00,000

Working Note:

Selling Price per unit before subsidy by government = (49,00,000/20,000) = Rs. 245

Selling price per unit after subsidy by government = Rs. 245 – Rs. 100 = Rs. 145

IMPORTANT NOTE: Selling price to be estimated, we have to convert profit margin from sales to cost.

 

Solution of Problem No. 1 4

Cost Sheet of Raja Textiles Co. Ltd.

For the year ended on 2011 – 12

PARTICULARS

AMOUNT

AMOUNT

Cotton Consumed

Add: Carriage Inward

10,00,000

50,000

 

10,50,000

(a) Raw Material Consumed during the year

Add: Direct Wages

10,50,000

10,00,000

Prime Cost

Add: Factory Overheads:

Indirect labour

Salary of work director and staff in factory

Water, power and local taxes

Dyeing, Bleaching

Depreciation

Excise and other taxes

Misc. Expenses

 

 

4,00,000

2,50,000

5,00,000

10,00,000

2,00,000

30,00,000

1,00,000

20,50,000

 

 

 

 

 

 

 

54,50,000

Work’s Cost

Add: Office and Administrative Overheads:

Salary of Managing Director

Depreciation of Machines (Office)

Misc. Office expenses

Director Fees

Office salaries

 

 

1,00,000

1,00,000

1,00,000

2,00,000

10,00,000

75,00,000

 

 

 

 

 

15,00,000

Cost of production

Add: Selling & Distributive Overheads:

Advertising and Publicity

Commission paid on sales

Commission paid to foreign buyers

Packaging and forwarding

Expenditure of sales depot

Marketing expenses out

 

 

10,00,000

10,00,000

1,00,000

2,00,000

4,00,000

1,00,000

90,00,000

 

 

 

 

 

 

28,00,000

Cost of Sales

Add: Profit margin

(20% on paid up capital which is Rs. 1,00,00,000)

1,18,00,000

 

20,00,000

Expected Sales

Less: Sales to government (10, 00, 000 mtrs)

 

10,00,000

1,38,00,000

40,00,000

Expected sales in open market (10, 00, 000 mtrs)

98,00,000

Working Note : Estimated selling price per unit for the open market = (expected sales in open market/ no. of units to be sold in open market)  = 98,00,000/10,00,000

 

Solution of Problem No. 1 5

Cost Sheet of Product A

PARTICULARS

AMOUNT

AMOUNT

Materials used in manufacturing

Primary packing material

Freight on materials purchased

60,000

10,000

5,000

 

 

75,000

(a) Raw Material Consumed during the year

Add: Direct Labour

75,000

10,000

(b) Prime Cost

Add: Factory Overheads:

Material used in the factory

Labour required to factory supervision

Indirect Expenses

Depreciation on Factory Building

 

 

750

2,000

1,000

1,750

85,000

 

 

 

 

5,500

(c) Work’s Cost

Add: Office and administrative Overheads:

Materials

Administrative Expenses

Depreciation on office Building

 

 

1,250

1,250

750

90,500

 

 

 

3,220

(d) Cost of Production

Add: Selling and Distributive Overheads:

Selling expenses

Material used in selling price

Advertisement

 

 

3,500

1,500

1,250

93,750

 

 

 

6,250

(e) Total Cost

Add: Profit @ 20% on selling price [Note – 1]

1,00,000

25,000

Sales

1,25,000

Working Note: Since profit is 20% sales, therefore required profit is = 1,00,000 * 20/80 = 25,000

 

Solution of Problem No. 1 6

Cost Sheet of Vindhyachal Industries

For the year ended on 31st December, 2012

PARTICULARS

UNIT

AMOUNT

Opening of Raw Material

Add: Purchases of Raw material [Note – 1]

Freight on Raw Material purchased

11,620

88,610

5,570

 

Less: Closing Stock of Raw Material

1,05,800

9,640

(a) Raw Material Consumed during the year

Add: Direct Labour

96,160

32,640

(b) Prime Cost

Add: Factory Overheads:

Indirect Labour

Other Factory Expenses

Indirect materials

1,28,800

 

12,160

31,730

21,390

(c) Factory cost incurred

Add: Opening Stock of work-in-progress

Less: Closing Stock of work-in-progress

1,94,080

5,740

7,820

(d) Factory Cost or Cost of Production

Add: Opening Stock of finished goods [12 x 500]

Less: Closing stock of finished goods [12 x 1,500]

16,000

500

1,500

1,92,000

6,000

18,000

(e) Cost of goods sold

Add: Profit

15,000

1,80,000

1,80,000

(f) Sales

15,000

3,60,000

Working Note:

Note – 1: Calculation of Purchases:

PARTICULARS

AMOUNT

Factory cost incurred

Less: Factory Overheads:

Indirect Labour

Other Factory Expenses

Indirect materials

1,94,080

 

12,160

31,730

21,390

 

Less: Direct Labour

1,28,800

32,640

 

Less: Opening Stock of Raw Materials

Add: Closing Stock of Raw Materials

Less: Freight on Raw Material Purchased

96,160

11,620

9,640

5,510

Purchase of Raw Materials

88,610

 

Solution of Problem No. 1 7

Cost Sheet of Adarsh Manufacturing Company

For the month of April, 2012

PARTICULARS

AMOUNT

Opening Stock of Raw Materials

Add: Purchases [Note – 1]

Less: Closing Stock of Raw Materials

8,000

36,500

10,600

(a) Raw Materials during the year

Add: Wages

33,900

17,500

(b) Prime Cost

Add: Factory Overheads:

51,400

10,000

(c) Work’s Cost incurred

Add: Opening Stock of work-in-progress

Less: Closing Stock of work-in-progress

61,400

10,500

14,500

(d) Work’s Cost

Add: Office and administrative Overheads:

57,400

2,500

(e) Cost of Production

Add: Opening Stock of finished goods

Less: Closing Stock of finished goods

59,900

17,600

19,000

(f) Cost of goods Sold

Add: Selling and Distributive Overheads:

58,500

3,500

(g) Cost of Sales

(h) Profit

62,000

13,000

Sales

75,000

Working Notes:

Note – 1: Calculation of Purchases of Raw Material

PARTICULARS

AMOUNT

Cost of goods sold

Less: Opening Stock of finished goods

Add: Closing Stock of finished goods

56,000

17,600

19,000

 

Less: Opening Stock of work-in-progress

Add: Closing Stock of work-in-progress

57,400

10,500

14,500

 

Less: Works/Factory Overheads (17,500*100/175)

61,400

10,000

 

Less: Direct Labour

51,400

17,500

 

Less: Opening Stock of Raw Materials

Add: Closing Stock of Raw Materials

32,900

8,000

10,600

Purchase of Raw Materials

36,500

 

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