Cost sheet questions
- 1. Question 1 A factory uses a job costing system. The following cost data are available from the books for the year ended 31st March, 1989: Rs. Direct Material 9,00,000 Direct Wages 7,50,000 Profit 6,09,000 Selling and Distribution Overhead 5,25,000 Administrative Overhead 4,20,000 Factory Overhead 4,50,000 Required (a) Prepare a Cost Sheet indicating the prime cost, works cost, production cost, cost of sales and sales value. (b) In 1989-90, the factory has received an order for a number of jobs. It is estimated that the direct materials is would be Rs. 12,00,000 and direct labour would cost Rs. 7,50,000. What would be the price for these jobs if the factory intends to earn the same rate of profit on sales, assuming that the selling and distribution overhead has gone up by 15%. The factory recovers factory overhead as a percentage of direct wages and administrative and selling and distribution overheads as a percentage of works cost, based on the cost rates prevalent in the previous year. Question 2 The books of Adarsh Manufacturing Company present the following data for the month of April, 1992. Direct labour cost Rs. 17,500 being 175% of works overheads. Cost of goods sold excluding administrative expenses Rs. 56,000. Inventory accounts showed the following opening and closing balance: April 1 April 30 Rs. Rs. Raw materials 8,000 10,600 Works in progress 10,500 14,500 Finished goods 17,600 19,000 Other data are : Rs. Selling expenses 3,500 General and administration expenses 2,500 Sales for the month 75,000 You are required to (i) Compute the value of materials purchased (ii) Prepare a cost statement showing the various elements of cost and also the profit earned.