Statement of Cost Sheet

Brief Format
Particulars Rs Rs
Direct Material Consumed
Direct Labour
Direct Expenses
Prime Cost
Add: Factory or works or Manufacturing Overheads
Factory Cost or Work Cost

Add: Office and Administration Overheads

Cost of Production

Add: Selling and Distribution Overheads

Cost of Sales
Profit/Loss
Sales
 Detailed Cost Sheet
Statement of Cost Sheet
Particulars Rs Rs
Opening Stock of Raw Materials
Add: Purchases
Add: Carriage Inwards
Less: Purchase Returns
Less: Closing Stock of Raw materials
Direct Material Consumed
ADD: Direct Labour
ADD: Direct Expenses
Prime Cost
Add: Factory or works or Manufacturing Overheads
Less: Amount Reliased from scrap
Add: Openings Stock of Work in Progress
Less: Closing Stock of Work in Progress
Factory Cost or Work Cost
Add: Office and Administration Overheads
Cost of Production
Add: Opening Stock of Finished Goods
Less: Closing Stock of Finished Goods
Cost of Goods Sold
Add: Selling and Distribution Overheads
Cost of Sales/Total Cost
Profit/Loss (Balancing Figure)
Sales

Method of
Costing
Nature of Output Application
Single Unit Based on customer Specification Job Costing
Number of similar units based on Customer
Batch Costing
Specification
Execution of work based on customer specification Contract Costing
Number of Similar units of a standardised single
Output Costing
product manufactured in a single process
Number of similar units of a standardised single
Process Costing
product manufactured through a series of process
Operating
Any services
Costing

Sl.No Item of Cost Apportionment

1 Raw materials Prime cost
2 Carriage Inwards Prime cost

3 Wages Prime cost

4 Chargeable Expenses Prime cost

5 Indirect Materials Factory Cost

6 Indirect Wages Factory Cost

7 Factory Rent Factory Cost

8 Factory Lighting Factory Cost

9 Power or motive power Factory Cost

10 Haulage Factory Cost

11 Repairs of Machinery Factory Cost

12 Factory Cleaning Factory Cost

13 Directors Fees Office Cost

14 Water Supply Factory Cost
15 office rent Office Cost

16 office salary Office Cost

17 General expenses Office Cost

18 Audit fees Office Cost

19 Directors fees Office Cost

20 Printing and Stationery Office Cost

21 Depreciation of office premises Office Cost

Selling and administration
22 carriage outward
cost
Selling and administration
23 Advertising cost
Selling and administration
24 Travelling Expenses cost
Selling and administration
25 Rent of Warehouse cost

26 Audit fees Office Cost

Selling and administration
27 Salesman Commission
cost
28 legal Expenses Office Cost
Selling and administration
29 Salary to delivery personnel cost
Selling and administration
30 Depreciation on Delivery vans cost
 Problems on Cost Sheet
1. Prepare a Cost Sheet from the following information of Relic India Ltd for
the year ending 31-3-2023

Sales 3,50,00 L LAST

0
Purchase of raw materials 1,55,00 P P
0
Freight paid on raw materials purchase 4,000 P P
Productive wages paid 75,000 P P
Unproductive wages 22,000 F F
Productive wages outstanding 7,000 P P
Royalty on production (direct expenses) 18,000 P P
Fuel and power 4,500 F F
Factory rent 6,300 F F
Insurance of machinery 1,700 E F
Loading and unloading charges on purchase 3,500 P P
of raw materials
Loss on sale of old machinery 5,400 F EX
Depreciation of machinery (To be added in 8,300 F F
cost sheet)
Lighting – Factory 700 F F
Factory cleaning 400 F F
Advertising 3,700 S S
Carriage outwards 1,300 S S
Income tax 6,040 E EX
Factory telephone 890 F F
Plant repairs and maintenance 2,500 F F
Office computer depreciation 12,000 O O
Office Stationery 2,100 O O
Travelling expenses - Salesmen 3,500 S S
- Office staff 1,800 O O
Donation 1,350 E EX
Salaries for salesman 7,000 S S
Marketing research expenses 1,400 S S
Bank charges and interest 340 E EX
Expenses on office cars 3,500 O O
Office managers salary 5,400 O O
Bad Debts 700 E EX
 2. The following data have been extracted from the books of MICO Ltd. For the
year ending 31-03-2023

Wages - Direct 75,000 P P

- Indirect (factory) 10,000 F F
Rent and rates – factory 5,000 F F
- Office 500 O O
Salary – Office 1,500 O O
- Salesmen 2,000 S S
Indirect Materials 1,500 F F
Office Expenses 900 O O
Managing Directors’ remuneration 12,000 O O
Advertisement 2,000 S S
Commission on issue of shares 6,000 E EX
Profit on sales of capital assets 2,000 E EX
Transfer of general reserve 10,000 O EX
Factory expenses 3,700 F F
Selling expenses 1,000 S S
Travelling expenses of salesmen 1,100 S S
Carriage and Freight outward 1,000 S S
Sales 2,30,000 L LAST
Purchase of raw materials 75,000 P P
Other direct expenses 15,000 P P
Depreciation – Plant 2,500 F F
- Office furniture 1,100 O O
Advance income tax paid 15,000 E EX
Goodwill written off 8,000 E EX

3. From the following information relating to Pune Industries Ltd for the year
ending 31st March 2012, you are required to prepare a statement of Cost
Showing.
a. Prime cost
b. Factory Overheads
c. Factory Cost
d. Total Cost
e. Profit or Loss for the period
Direct wages 2,40,000 P P
Direct materials purchased 3,22,000 P P
Purchase returns 13,000 P(-) P
Drawing office salaries 3,100 O O
Carriage on direct materials 4,200 P PP
Chargeable expenses 2,800 P P
Provision for bad debts 2,400 E EX
Office expenses 6,400 O O
Factory rent and rates 3,200 F F
Depreciation on plant 900 F F
Showroom rent 3,400 S S
Misc. Selling expenses 2,800 S S
Lighting 2,000 F F
Gas and water 6,000 F F
Power 1,500 F F
Haulage Hire 4,600 F F
Travelling expenses 450 S S
Showroom telephone expenses 3,500 S S
Labour welfare expenses 7,500 F F
Sales of scrap 2,000 F(-) F-
Factory Supervision 3,500 F F
Sales 6,40,000 L LAST

4. From the following figures, prepare a cost sheet showing the cost and profit
per unit

Raw materials 4,00,000

Direct wages 2,40,000
Factory overheads 25% Prime cost
Office overheads 15% of factory
cost
Selling overheads Rs. 30 per unit
sold
Units produced 2000 units
Units sold 1,800 at 600 each

Standard Percentages for Preparation for Estimates and quotations

a. Percentage of Factory Overheads to direct cost
factory
Total eads
h
x 100
Direct wages
b. Percentage of Office Overheads to Factory Cost
office∧administration
Total eads
h
x 100
Factory cost
c. Percentages for Selling and Distribution Overheads to Factory Cost
Total Selling∧distribution overheads
x 100
Factory cost
d. Percentage of profit on Total Cost
Profit
x 100
Total Cost

5. From the following information, Prepare Cost Sheet

Particulars Rs.
Cost of Production Rs. 10,00,000
Opening stock of finished goods (Rs. 50 per 2,500 units
unit)
Closing stock of Finished goods 5000 units
Selling Expenses Rs. 10 per unit
sold
Profit 20% on Sales
Unit Sold 7,500

6. The following expenses were incurred for a job during the year ending 31
December 2023
 Particulars Rs
Direct Materials 1,20,000
Direct wages 1,60,000
Chargeable expenses 40,000
Factory overheads 80,000
Administrative overheads 1,20,000
Selling and Distribution overheads 80,000
Selling price for the above job 7,20,000
You are required to prepare a statement showing the profit earned for the
year 2023 from the job and an estimated job should be executed for the year
2024. Materials wages and chargeable expenses would cost Rs. 20,000, Rs.
28,000 and Rs. 8,000 respectively, for the job.
The various overheads should be recovered on the following basis while
calculating the price
1. Factory overheads as a percentage of Direct wages
2. Administrative and selling overheads as percentage of factory cost
3. Rate of Profit on cost of 2023 is to applied.

7. In respect of a factory, the following particulars have been extracted for the
year 2023

Particulars Rs
Cost of materials 6,00,000
Wages 5,00,000
Factory overheads 3,00,000
Administration charges 3,36,000
Selling Charges 2,24,000
Distribution Charges 1,40,000
Profit 4,20,000
A work order has to be executed in 2024 and the estimated expenses are
materials – Rs. 8,000 and wages Rs. 5,000
Assuming that in 2024, the rate of factory overheads has gone up by 20%,
distribution charges have gone down by 10% and selling and administration
charges have gone each up 15%, at what price should the product be sold so
as to earn the same rate of profit on the selling price as in 2023? Factory
overheads are based on wages and administration, selling and distribution
overheads on factory cost.

8. The Following data is furnished by a company for the year 2023

Particulars Rs
Stock of materials on 1-1-2023 35,000
Stock of materials on 31-12-2023 5,000
Purchases of materials 50,000
 Wages 1,00,000
Factory overheads 20,000
Administration overheads 20,000
Closing stock of finished goods 20,000
Sales 2,50,000
Production during the year 5,000 units
The Company wants to quote for a contract for the supply of 1,000 units
during the year 2024. The cost of materials is expected to increase by 15%
and wages 10%.
Prepare a statement of cost for the year 2023 and a tender statement 2024
showing the price to be quoted per unit, if the same percentage of profit is
maintained as in the previous year.

9. From the following particulars, you are required to prepare the statement of
cost for the year ended 31 march 2023

Particulars Rs
Stock of finished goods on 01-04-2022 72,800
Stock of raw materials on 01-04-2022 33,280
Purchase of raw materials 7,59,200
Sales 15,39,200
Productive wages 5,16,880
Stock of raw materials goods on 31-3-2023 78,000
Stock of finished goods on 31-3-2023 35,360
Works overheads 1,29,220
Office and general expenses 70,161
The company is about to send to tender for a larger plant. The costing
department estimated that the materials required would cost Rs. 52,000/-
and wages of workmen Rs. 31,200. The tender is expected to make a profit
of 20% on selling price. Prepare statement of cost and tender price.

10.Following are the particulars for the production of 2000 machines of A

Engineering works ltd. for the year 2023.

Particulars Rs
Cost of materials 1,60,000
Productive Wages 2,40,000
Manufacturing expenses 1,00,000
Depreciation 1,20,000
Rent, Rates and insurance 20,000
Selling Expenses 60,000
General Expenses 40,000
Sales 8,20,000
The company plans to manufacture 3000 machines during the year 2024.
You are required to submit a statement showing the price at which they are
to be marketed to earn a profit of 20% on selling price.
The following additional information is supplied to you
 The price of materials to go up by 25%
 The wage rates are expected to show an increase of 10%
 The manufacturing expenses will increase in proportion to the
combined cost of materials and wages
 The selling expenses per unit will increase by 10%
 Other expenses will remain unaffected by the change in the output