COST SHEET

Test Series – CA Inter – Cost Sheet

Time Allowed – Reading – 5 Minutes Maximum Marks - 20
Solving – 40 Minutes

Ques on 1 8 Marks
G Ltd. manufactures leather bags for office and school purposes.
The following informa on is related with the produc on of leather bags for the month of September 2021.
(1) Leather sheets and co on clothes are the main inputs and the es mated requirement per bag is two
metres of leather sheets and one metre of co on cloth. 2,000 metre of leather sheets and 1,000 metre
of co on cloths are purchased at ₹ 3,20,000 and ₹ 15,000 respec vely. Freight paid on purchases is ₹
8,500.
(2) S tching and finishing need 2,000-man hours at ₹ 80 per hour.
(3) Other direct costs of ₹ 10 per labour hour is incurred.
(4) G Ltd have 4 machines at a total cost of ₹ 22,00,000. Machines have a life of 10 years with a scrap value of 10%
of the original cost. Deprecia on is charged on a straight-line method.
(5) The monthly cost of administra on and sales office staffs are ₹ 45,000 and ₹ 72,000 respec vely. G Ltd pays ₹
1,20,000 per month as rent for a 2,400 sq. feet factory premises. The administra ve and sales office occupies
240 sq. feet and 200 sq. feet respec vely of factory space.
(6) Freight paid on delivery of finished bags is ₹ 18,000.
(7) During the month, 35 kgs of scrap (cu ngs of leather and co on) are sold at ₹ 150 per kg.
(8) There are no opening and closing stocks of input materials. There is a finished stock of 100 bags in stock at the
end of the month.

You are required to prepare a cost sheet in respect of above for the month of September 2021 showing :
(i) Cost of Raw Material Consumed
(ii) Prime Cost
(iii) Works/Factory Cost
(iv) Cost of Produc on
(v) Cost of Goods Sold
(vi) Cost of Sales

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CA, CFA (USA), CPA (USA) PRAVEEN KHATOD - Leaders in Advanced Financial Education Across India
 COST SHEET

Ques on 2 10 Marks
The following data relates to manufacturing of a standard product during the month of March, 2021:
Par culars Amount (in ₹)
Stock of Raw material as on 01-03-2021 80,000
Work in Progress as on 01-03-2021 50,000
Purchase of Raw material 2,00,000
Carriage Inwards 20,000
Direct Wages 1,00,000
Advance wages at the beginning 20,000
Cost of special drawing 30,000
Hire charges paid for Plant (Indirect) 24,000
Return of Raw Material 40,000
Carriage on return 6,000
Expenses for par cipa on in Industrial exhibi on 8,000
Legal charges 2,500
Salary to office staff 25,000
Maintenance of office building 2,000
Deprecia on on Delivery van 6,000
Warehousing charges 1,500
Stock of Raw material as on 31-03-2021 30,000
Stock of Work in Progress as on 31-03-2021 24,000
Ÿ Store overheads on materials are 10% of material consumed.
Ÿ Factory overheads are 20% of the Prime cost.
Ÿ 10% of the output was rejected and a sum of ₹ 5,000 was realized on sale of scrap.
Ÿ 10% of the finished product was found to be defec ve and the defec ve products were rec fied at an
addi onal expenditure which is equivalent to 20% of propor onate direct wages.
Ÿ The total output was 8000 units during the month.

You are required to answer the following for the above period showing the:
(i) Cost of Raw Material consumed.
a. 2,10,000
b. 2,30,000
c. 2,31,500
d. 2,70,000
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CA, CFA (USA), CPA (USA) PRAVEEN KHATOD - Leaders in Advanced Financial Education Across India
 COST SHEET

Ÿ (ii) Prime Cost

a. 3,80,000
b. 3,86,000
c. 4,03,000
d. 4,04,000

(iii) Work Cost

a. 5,11,160
b. 5,12,660
c. 5,32,160
d. 5,37,160

(iv) Cost of Produc on

a. 5,32,160
b. 5,33,660
c. 5,36,960
d. 5,59,160

(v) Cost of Sales

a. 5,77,160
b. 5,77,400
c. 5,81,960
d. 5,82,200

Ques on 3 1 Mark
Generally, for the purpose of preparing marginal cost sheet, costs are classified on the basis of:
(a) Func ons
(b) Variability or Behavior
(c) Relevance
(d) Nature or Element

Ques on 4 1 Mark
A manufacture has set-up a lab for tes ng of products for compliance With standards, salary of this lab staffs
are part of:
(a) Works overheads
(b) Quality Control Cost
(c) Direct Expenses
(d) Research & Development Cost.

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CA, CFA (USA), CPA (USA) PRAVEEN KHATOD - Leaders in Advanced Financial Education Across India