Cost Sheet

Op. STOCK (Raw material) + Purchases (Incl. freight I/W) -Clo. Stock (Raw material) = Materials Consumed (a) Direct Labour (b) Direct Expenses (c) Prime Cost (a+b+c) + Factory overheads (net of scrap) + Op. Stock (WIP)

Clo. Stock (WIP)

Factory or Works Cost + Administration overheads Production cost of Goods Produced + Op. stock of finished goods - Clo.stock of finished goods Cost of Prodn. of goods Sold +Selling & Distribn. Overheads Cost of Sales + Profit Sales (Net of taxes)

Inventory Control - Formulaes

Reorder Level = Maximum Reorder period * Maximum usage Or Reorder Level = Minimum Level + Consumption during the time to get fresh delivery Maximum Stock Level = Reorder Level + Reorder Quantity (Minimum usage * Minimum reorder period) Minimum Stock Level = Reorder Level (Normal Consumption * Normal Reorder period) Average Stock level = *(Maximum Stock level + Minimum Stock Level ) Or Average Stock level = Minimum Stock level + of Re-order Quantity