Cost Sheet

IMPORTANT POINTS
1. Total cost = Prime cost + overhead
2. Sales = Total cost + profit

3. Prime cost = cost of material consumed+ direct wages +

direct exp./chargeable exp
4. Total overhead = factory overhead + office overhead +
selling overhead

5. Sales units = opening stock units + production units – closing

stock units

6. If production units and sales units are given, do not forget to

calculate opening or closing stock units of finished goods from
the above formula. For example,
5000=op+4000-cl or, +1,000 units = op –cl or, op st = 1000
 1. The opening and closing stock and other cost data of a manufacturing company for a year are
Stocks
given below: 01-01-2019 31-12-2019
Raw material Rs. 20,000 Rs. 30,000
Work-in-progress Rs.5,000 Rs. 7,000
Finished goods 1,000 units and Rs. 40,000 500 units

The information available from the cost records for the year ended was as follows:
Purchase of raw materials Rs. 150,000 COM Carriage inward Rs. 5,000 COM
Manufacturing wages Rs. 40,000 PC Indirect expenses Rs. 10,000 F OH
Supervisor’s salary Rs. 20,000 F OH Heating & lighting Rs. 20,000 F OH
Fuel expenses Rs. 5,000 F OH Primary packing expenses Rs. 10,000 F OH
Rent Rs. 25,000 OOH Salary Rs. 20,000 OOH
Sale of scrap Rs. 3,000 FOH Director’s fee Rs. 5,000
Carriage outward Rs. 3,000 SOH Other selling expenses Rs. 3 per unit SOH
Depreciation on: Profit 20% on cost
Plant 5,000 FOH Production units4,000
Furniture 4,000 OOH
Delivery van 6,000 SOH Required: Cost sheet
 Cost Sheet
Output: 4,000 units
PARTICULARS AMOUNT (Rs.) AMOUNT (Rs.)

Opening stock of raw materials 20,000

Add: Purchase of raw materials 150,000
Carriage/exp on purchase 5,000
175,000
Less: Cl. Stock of raw materials 30,000 145,000
Cost of material consumed 145,000
Add: Direct wage/labour/Productive wage/Mafg. Wage 40,000
Add: Direct exp.
Prime cost 185,000
Add: Factory overhead:
Indirect expenses 10,000
Supervisor’s salary 20,000
Heating & lighting 20,000
 Cost Sheet
Output: 4,000 units
PARTICULARS AMOUNT (Rs.) AMOUNT (Rs.)

70,000
Add: Opening stock of WIP 5,000
Cl. Stock of WIP (7,000)
68,000
Less: Sale of scrap 3,000 65,000
Factory cost/Work cost 250,000
Add: Office and adm. Overheads: 25,000
Rent 20,000
Salary 5,000
Director’s fee 4,000 54,000
Depreciation on furniture
Cost of production 304,000
Add: Opening stock of finished goods 40,000
Cost of goods sold 306,000
Add: Selling and distribution overheads:
Carriage outward 3,000
Other selling expenses (Rs. 3x sales units) 13,500
Depreciation on delivery van 6,000 22,500

Total Cost 328,500

Add: Profit (20% on cost Rs. 328,500) 65,700

Sales 394,200
Total cost
Add: Profit (25% on sales)
Sales (100%)

 
Working notes:
a. Sales units = Opening stock units + Production units – Closing stock units

= 1,000 + 4,000 – 500 = 4,500 units

b. Cost of production per unit = =

= Rs. 76/unit