‘Native’ Co. Ltd suffered a loss of Rs 25,000 as per the financial accounts. On comparison with its costing records for the same year, the following differences were observed:

Prepare a reconciliation statement, with the help of the differences.

Rs Overvaluation of opening stock of materials in cost books 1,200 Under valuation of closing stock of finished goods in financial books 3,000

‘Dormant’ materials written off (in financial books) 1,000 Under absorption of overheads 4,000 Fines levied by Municipality 500 Debenture interest paid 2,000