MODULE 1

PERFORMA OF COST SHEET

Particulars Amount
I PRIME COST
(i) Direct material/ Material consumed/ Material uses /
Convertible material
Opening stock of raw material ***
Add:- Purchases ***
Add:- Carriage Inwards ***
Add :- Octroi ***
Less :- Closing Stock of Raw Material ***
Raw- Material Consumed ****
(ii) Direct Wages / Productive wages/Direct Labour ****
(iii) Direct Expenses / Chargeable Expenses ****
TOTAL PRIME COST ****
(II) Factory / Work's Overhead /Manufacturing Overhead
Fuel ****
Power & water ****
Factory Lighting & heating ****
Indirect material ****
Wages for foreman ****
Factory rent & taxes ****
Indirect wages ****
Leave wages ****
Factory Insurance ****
Supervision ****
Works Stationary ****
Repairs ****
Haulage (transport with in factory) ****
Works Salary ****
Depreciation of plant & machinery ****
Work Expenses ****
Gas & water ****
Technical director's Fees ****
Laboratory Expenses ****
Works Telephone Expenses ****
Other Factory Expenses ****
TOTAL FACTORY OVERHEAD ****
Less: - Sales of Scrap ****
Add:- Opening Stock of Work- In - Progress ****
Less:- Closing Stock of Work- In - Progress ****
FACTORY COST / WORK COST ****
III OFFICE & ADMINISTARTIVE OVERHEADS
Office Salaries ****
Director's Fees ****
Office Rent & taxes ****
Office Stationary & Printing ****
Sundry Office Expenses ****
Depreciation of Office Furniture ****
Subscription to trade journals ****
Office Lighting ****
Establishment Charges ****
Director's Travelling Expenses ****
Postage charges ****
Legal Charges ****
Audit Fees ****
Depreciation & Repair of office Equipment ****
Telephone charges **** ****
COST OF PRODUCTION ****
Add:- Opening Stock of finished goods ****
Less:- Closing Stock of finished goods ****
COST OF GOODS SOLD (COGS) ****
IV. SELLING & DISTRIBUTION OVERHEAD
Showroom Expenses ****
Advertisement Expenses ****
Bad Debts ****
Salesman Salary ****
Packing Charges ****
Carriage Outwards ****
Commission to Sales agent ****
Samples & gifts ****
Travelling Expenses relating to sales ****
Sales manager salary ****
Depreciation & repairs on delivery van ****
Trade discount
Other selling & distribution Expenses ****
COST ON SALES ****
Add :- PROFIT (Balancing figure) ****
Less :- LOSS (Balancing figure) ****
SALES ****
Items or Cost not included in Cost Sheet / Costs which Excluded from Cost Sheet
SL No. Costs
1 Cash Discount
2 Interest Paid
3 Preliminary Expenses Written Off
4 Good Will Written off
5 Provision for tax
6 Provision for bad debts
7 Transfer to reserve / transfer to sinking funds
8 Donation
9 Income tax paid
10 Dividend Paid
11 Profit or loss on sale of fixed assets
12 Damage payable at law
 Components/Elements of PRIME COST
1. Direct Material
2. Direct Wages / Labour
3. Direct Expenses / Chargeable Expenses

1. From the following information prepare cost sheet of SLS Ltd as on 31/3/2023
SL
Particulars Amount SL No. Particulars Amount
No.
1 Raw material 38,000 20 Factory heating 4,800
2 unproductive wages 11,250 21 directors fees 2,000
3 Motive Power 5,600 22 Sundry Expenses 360
4 Directors Fees [Work] 6,200 23 Printing & Stationary 920
5 Factory Cleaning 2,500 24 Rent & Taxes 840
6 Water 800 25 Legal Charges 420
7 Office insurance 1750 26 Provision for Bad debts 2,100
8 Loose tools written off 2,150 27 Rent for warehouse 320
9 Chargeable Expenses 680 28 Bad debts 160
10 Depreciation 3,000 29 Income tax paid 750
11 Land & Machinery 1,850 30 Advertisement 630
12 Office Furniture 2,680 31 Reserves for doubtful debts 155
13 Delivery Vans 1,200 32 Interest on debenture 3,000
14 Productive Wages 3,200 33 Sales department salary 1,500
15 Up-keep of delivery vans 450 34 Bank Charges 50
16 Commission on Sales 800 35 Loss by Theft 2,500
Closing stock of raw-
17 1,320 36 Haulage 630
material
18 Purchases 25,600 37 Goodwill written off 650
19 Octroi 550 38 Sales 1,62,830

2. From the following information prepare cost sheet for DK Enterprise as on 31/12/2021
SL SL
Particulars Amount Particulars Amount
No. No.
1 Direct Material 1,00,000 29 Advertisement 11,000
2 Indirect Wages 50,000 30 Upkeep of delivery Vans 500
3 Productive Wages 2,00,000 31 Upkeep of staff cars 5,000
4 Chargeable Expenses 73,000 32 Sample & gift 2,100
 5 Rent & Taxes [1:3] 4,000 33 Bad debts 21,000
6 Lighting & Heating 1,000 34 Audit fees 3,000
7 Salary- 10,000 35 Haulage 8,500
Opening Stock of Raw-
8 Sales Manager Salary 10,000 36 3,000
material
9 Motive Power 21,000 37 Opening Stock of WIP 850
Opening Stock of finished
10 Manager Salary 12,000 38 30,000
goods -
11 Travelling Expenses 14,250 39 Postage & Telegram 5,000
12 Repairs & maintenance 7,500 40 Fright outwards 5,000
13 Lighting - 12,250 41 Income Tax 6,000
14 Salesman Salary 13,500 42 Cash Discount 6,000
15 Depreciation on Building[4: 5] 9,000 43 Travel Commission 4,000
16 Depreciation on delivery Vans 1,800 44 Interest on Debenture 2,000
17 Insurance [1:2:3] 8,000 45 Staff Cars Driver Salary 4,000
18 Showroom Expenses 23,000 46 Factory Stationary 3,000
19 Sale on Scrap 500 47 Employee Insurance 6,000
20 Commission 650 48 General Expenses 5,000
Depreciation of Office
21 6,000 49 Dividend on Equity shares 7,500
furniture
22 Legal Charges 4,000 50 Discount on Sales 5,000
23 Supervisor Salary 3,000 51 Administrative 4,000
Closing Stock of Raw
24 Purchases 20,000 52 2,800
material
25 Carriage Inwards 800 53 Closing Stock of WIP 3,600
26 Purchases Return 200 54 Closing Stock of finished goods 5,000
27 Loose tools written off 1,000 55 Profit 3,00,000
28 Factory Cleaning 500
Manager given his time 25% to factory, 60% to office & 15% to salary & distribution.

3. From the following particulars prepare cost sheet & percentage (%) of work cost to
direct wages, percentage (%) of office & administration overhead to factory cost,
Percentage (%) of sales & distribution overhead to factory cost.

SL No. Particulars Date Amount

1 Opening Stock of Raw-material 01-04-2023 30000
2 Opening Stock of finished goods 01-04-2023 68000
3 Closing Stock of Raw-material 31-03-2024 35000
4 Closing Stock of finished goods 31-03-2024 75000
5 Purchases of raw-material 800000
6 Sale of Finished goods 1600000
7 Productive Wages 550000
8 Work's Overhead 130000
 9 Office & Administrative Overhead 75000
10 Selling & distribution Overhead 20000
4. XYZ Ltd furnishes the following information for 10,000 units of a product
manufactured during the year 2024.

SL. No Particulars Amount

1 Material 90,000
2 Direct Wages 60,000
3 Power & Consumable 12,000
4 Indirect Wages 15,000
5 Factory Lighting 5,500
6 Cost of rectification of defective work 3,000
7 Clerical Salary & Maintenance Expenses 33,500
8 Selling Expenses 5,500
9 Sale of Scrap 2,000
10 Repair, Maintenance & Depreciation of plant 11,500
The net selling price was ₹ 31.60 per unit sold & all unit were sold.
As from1/1/2025, the selling price was reduced to 31 per unit. It was estimated that the
production may increases in 2025 by 50% due to spare capacity.
Rate of materials & direct wages will increase by 10%. You are required to prepare
(i) Cost Sheet for the year 2024 showing various element of cost per unit
(ii) Estimated cost & profit for 2025.
Assuming that 15,000 units will be produced & sold during the year 2025
& factory overhead will be recovered as % of direct wages & office &
selling Expenses as % of work’s cost.
5. From the books of Vishal enterprises, the following details have been Extracted for the
year ending 31st March 2023
Amount
Particulars
(₹)
Stock of material – Opening 1,88,000
Closing 2,00,000
Material purchased during the year 8,32,000
Direct wages 2,38,400
Indirect wages 16,000
Salaries to administrative staff 40,000
Fright – Inward 32,000
Outward 20,000
Sales 15,79,800
Cash discount allowed 14,000
Bad debts written off 18,800
Repairs of plant & machinery 42,400
Rent, rates & taxes -- Factory 12,000
office 6,400
Travelling Expenses 12,400
Salesmen’s salaries & commissions 33,600
Depreciation --- Plant & machinery 28,900
Furniture 2,400
Directors fees 24,000
Electricity charges 48,000
Fuel 64,000
Sale of scrap 500
General charges 24,800
Manager’s salary 48,000
The manager’s time is shared between the factory & the office in the ratio of 20:80
From the above information you are required to prepare cost sheet
 QUESTION PAPER PROBLEM
1. Based on the following information prepare a cost sheet incorporating the following
aspects of cost sheet.
(i) Total Manufacturing Cost
(ii) Cost of Production
(iii) Cost of Sales
(iv) Profit
Other Expenses are: -
a. Indirect labour ₹ 50,000
b. Administrative Expenses ₹ 1,00,000
c. Lubricants ₹ 10,000
d. Power ₹ 30,000
e. Insurance on plant ₹ 3,000
f. Direct labour ₹ 3,00,000
g. Purchase of raw-materials ₹ 4,00,000
h. Depreciation on machinery ₹ 50,000
i. Sales Commission ₹ 60,000
j. Factory Rent ₹ 60,000
k. Salaries of salesman ₹ 1,00,000
l. Property tax on factory ₹ 11,000
m. Carriage outwards ₹ 20,000
n. Sales ₹ 12,00,000 (Case study – Jan2020)
2. From the following information for the month of January. Prepare a cost sheet to show
(i) Prime Cost (ii) Factory Cost (iii) cost of Production (iv) Total cost

Particulars Amount
Direct Material 57,000
Direct Wages 28,500
Factory Rent & rates 2,500
Office rent & rates 500
Plant repairs & maintenance 1,000
Plant depreciation 1,250
Factory heating & lighting 400
Factory manager's salary 2,000
Office salaries 1,600
Director's remuneration 1,500
Telephone charges 200
Printing & Stationary 100
 Legal charges 150
Advertisement 1,500
Salesman's Salaries 2,500
Showroom rent 500
Sales 1,16,500
(June/July-2019)

3. The accounts of Basudev manufacture Ltd., for the year ending 31st December.
Stock of material on 1/1/2016 6720
Material Purchased 150000
Material Return to Suppliers 2000
Direct Labour 50000
Direct Expenses 20000
Factory Expenses 15300
Office & Administrative Expenses 8000
Selling & Distribution Expenses 7900
Stock of material on 31/12/2016 7720
Profit 10000
Find out i) Prime cost ii) Work cost iii) cost of Production iv) Total cost & Sales
(June/July-2018)

4. The following Extract of costing information relates to commodity ‘A’ for the year
ending 31st December 2019

Particulars Amount
Purchase of raw-material 60,000
Direct Wages 50,000
Rent, rates & insurance 20,000
Carriage inwards 1,000
Stock on 1st Jan 2019
Raw - materials 10,000
Work-in-Progress 2,400
 Finished goods (2000 tons) 8,000
Stock on 31st December 2019
Raw - materials 11,000
Work-in-Progress 8,000
Finished goods (4000 tons) ….
Cost of Factory Supervision 4,000
Sales of finished products 1,50,000
Advertisement & Selling Costs amount to Re. 0.40 per ton sold. 32000 tons of the
commodities were produced during the period. Prepare a cost sheet & find out profit per unit.