The Bhopal School of Social Sciences

(Affiliated to Barkatullah University, Bhopal)

E-content Development

Study Material
For
COST ACCOUNTING
UNIT-II
Module 3
Cost Sheet
(B.Com Second Year)

Prepared by:
Nitin Jain
Assistant Professor
Department of Commerce
BSSS, Bhopal
 Cost Accounting:Unit-II:Module-3
Cost Sheet

Index

S. No. Content
1. Practical Problems – Cost Sheet

2. References
 Cost Accounting:Unit-II:Module-3
Cost Sheet

Question.1:
In a factory, 1000 units of product X were manufactured in the month of April 2014. From
the following figures obtained from the costing records, prepare a cost sheet showing cost per
unit:
Rs.
Raw materials consumed 60,000
Direct Labour 30,000
Direct Expenses 10,000
Factory Overheads 40,000
Office Overheads 10,000
Selling Overheads 20,000

Solution:
Statement of Cost
Period…April 2014 Output…1,000 Units
Particulars Amount Cost Per Unit
Raw materials consumed 60,000 60.00
Direct Labour 30,000 30.00
Direct Expenses 10,000 10.00
Prime Cost 1,00,000 100.00
Factory Overheads 40,000 40.00
Factory Cost 1,40,000 140.00
Office Overheads 10,000 10.00
Production Cost 1,50,000 150.00
Selling Overheads 20,000 20.00
Total Cost 1,70,000 170.00
 Cost Accounting:Unit-II:Module-3
Cost Sheet

Question.2:
The following expenses are related to the production of 1,000 units during the month of August
2014:
Rs.
Direct material 12,000
Wages 10,000
Factory Rent & Taxes 1,000
Depreciation on Machinery 1,000
Supervisor’s Salary 2,000
Indirect Material 500
Indirect Labour 300
Office Expenses 1,500
Other Factory Expenses 500
Office Salaries 1,800
Printing & Stationery 400
Selling Expenses 2,500
Solution:
Statement of Cost
Period…August 2014 Output…1,000 Units
Particulars Amount Cost Per Unit
Direct material 12,000 12.00
Wages 10,000 10.00
Prime Cost 22,000 22.00
Factory Overheads:
Factory Rent & Taxes 1,000 1.00
Depreciation on machinery 1,000 1.00
Supervisor Salary 2,000 2.00
Indirect Material 500 0.50
Indirect Labour 300 0.30
Other Factory expenses 500 0.50
Factory Cost 27,300 27.30
Office & Administration Overheads:
Office expenses 1,500 1.50
Office salaries 1,800 1.80
Printing & Stationery 400 0.40
Production Cost 31,000 31.00
Selling & Distribution Overheads:
Selling expenses 2,500 2.50
Total Cost 33,500 33.50
 Cost Accounting:Unit-II:Module-3
Cost Sheet

Question.3:
Following data relate to a manufacturing of product for the month of January 2014:
Rs.
Materials used 1,00,000
Direct wages 28,000
Effective machine hours 4,000
Machine Hour Rate 8
Office overhead 10% of works cost
Selling & Distribution Expenses 75 Paise per unit
Units Manufactured 8,000
Units Sold 7,200
Selling Price Per Unit 25
Prepare a Cost Sheet showing (i). Cost per unit (ii). A Statement of Profit for the period.
Solution:

Statement of Cost
Period…January 2014 Units Manufactured…8,000 Units

Particulars Amount Cost Per Unit

Materials Used 1,00,000 12.50
Direct Wages 28,000 3.50
Prime Cost 1,28,000 16.00
Works Overhead (4,000 Machine Hrs@ Rs.8 per hr) 32,000 4.00
Works Cost 1,60,000 20.00
Office Overhead (10% of works cost) 16,000 2.00
Production Cost 1,76,000 22.00
Statement of Profit
Period…January 2014 Units Sold…7,200 Units
Particulars Amount Cost Per Unit
Cost of goods sold 1,58,400 22.00
Add: 5,400 0.75
Selling and Distribution Expenses
Total Cost 1,63,800 22.75
Profit 16,200 2.25
Sales 1,80,000 25.00
 Cost Accounting:Unit-II:Module-3
Cost Sheet

Try Yourself:

The following data relate to the manufacture of standard product during the month of March
2020:
Rs.
Raw materials consumed 80,000
Direct wages 48,000
Machine worked hours 8,000
Machine Hour Rate 4
Office Overhead 10% of works cost
Selling Overhead Rs. 1.50 per unit
Units produced 4,000
Units Sold 3,600 at Rs. 50 each
Prepare cost sheet.

Question.4:

A manufactures Stools, Chairs and Tables. The materials and wages are separated as follows:

Particulars Stool Chair Table

(Rs) (Rs) (Rs)

Materials for each 3.6 6.0 44.0

Wages for each 4.8 4.0 12.0
Production (in Units) 6,000 3,000 600
Total Factory Overhead……….Rs.60,000

You are required to determine the works cost of each type of furniture after assuming that one
table is equivalent to four stools and two chairs are equivalent to one table for the purpose of
factory overhead allocation.
 Cost Accounting:Unit-II:Module-3
Cost Sheet

Solution:

Cost Sheet

Particulars Stool Chair Table

(6000 Units) (3000 Units) (600 Units)

Cost Amount Cost Amount Cost per Amount

per unit per unit unit

Materials 3.6 21,600 6.0 18,000 44.0 26,400

Wages 4.8 28,800 4.0 12,000 12.0 7,200

Prime Cost 8.4 50,400 10.0 30,000 56.0 33,600

Factory Overhead 4.167 25,000 8.33 25,000 16.67 10,000

(5:5:2)…60,000

Works Cost 12.567 75,400 18.33 55,000 72.67 43,600

Working Notes:

Condition 1………………..1 Table = 4 Stools

Condition 2…………………2 Chairs = 1 Table

1 Table = 4 Stool……………………eqn(1)

2 Chairs = 1 Table

Substitute the value of 1 Table from eqn 1

2 Chairs = 4 Stool

1 Chair = 2 Stool……………………eqn(2)

6000 Stools : 3000 Chairs : 600 Table

6000 Stool : 3000 (2 Stool) : 600 (4 Stool)

6000 : 6000 : 2400

5:5:2
 Cost Accounting:Unit-II:Module-3
Cost Sheet

Question.5:

A manufactures Shirts, Pants and Coats. The materials and wages are separated as follows:

Particulars Shirts Pants Coats

(Rs) (Rs) (Rs)

Materials for each 50 75 400

Wages for each 30 45 160
Production (in Units) 500 200 100
Total Factory Overhead……….Rs.39,000

You are required to determine the total cost of each type of furniture after assuming that one
coat is equivalent to four shirts and two pants are equivalent to one coat for the purpose of
factory overhead allocation. The office overheads amounted to Rs. 15,000 to be allocated on
the basis of Prime Cost.
Solution:
Cost Sheet

Particulars Shirts (500 Units) Pants (200 Units) Coats (100 Units)

Cost Amount Cost Amount Cost per Amount

per per unit
unit unit

Materials 50 25,000 75 15,000 400 40,000

Wages 30 15,000 45 9,000 160 16,000

Prime Cost 80 40,000 120 24,000 560 56,000

Factory Overhead 30 15,000 60 12,000 120 12,000

(5:4:4)

Works Cost 110 55,000 180 36,000 680 68,000

Office Oncost 10 5,000 15 3,000 70 7,000

(40000:24000:56000)
i.e (5:3:7)

Total Cost 120 60,000 195 39,000 750 75,000

Working Notes:

Condition 1……..1 Coat = 4 Shirts

Condition 2……..2 Pants = 1 Coat

 Cost Accounting:Unit-II:Module-3
Cost Sheet

Substitute the value of 1 table from condition 1 to condition 2, we get

2 Pants = 1 Coat

2 Pants = 4 Shirts

1 Pant = 2 shirt

500 Shirts : 200 Pants : 100 Coats

500 Shirts : 200 (2 Shirt) : 100 (4 Shirt)

500 : 400 : 400

5:4:4

Total Factory Overhead : Rs. 39,000

Shirt = 39,000*5/13 = Rs.15,000

Pant = 39,000*4/13 = Rs. 12,000

Coat = 39,000*4/13 = Rs. 12,000

Try Yourself:
A manufactures Table Fan, Ceiling Fan and Room Coolers. The materials and wages are
separated as follows:

Particulars Table Fan Ceiling Room

(Rs) Fan (Rs) Cooler
(Rs)

Materials for each 20 25 125

Wages for each 40 60 120
Production (in Units) 250 125 25
Total Factory Overhead………Rs.30,000
Total Office Overhead………..Rs.10,000
Total Selling & Distribution Overhead.Rs.15,000
You are required to determine the total cost of each type of furniture after assuming that one
ceiling fan is equivalent to two table fans and one room cooler is equivalent to five table fans
for the purpose of factory overhead allocation. The office overheads and selling overheads to
be allocated on the basis of Prime Cost.
 Cost Accounting:Unit-II:Module-3
Cost Sheet

References:

https://www.accountingnotes.net/cost-accounting/output-costing/output-costing-meaning-
features-and-objectives-cost-accounting/15147

https://www.economicsdiscussion.net/cost-accounting/cost-sheet/32626

Cost Accounting. By Prof M L Agarwal

Cost Accounting, By Jain & Narang