Acost sheetprovides per unitcostof a product or service which the organization incurs at every stage of business operation, which helps themanagementto analyze and control such overheads. It also helps in deciding the selling price of a product or service based on thecostincurred and profit expected out of it.

Q_1: Cost Sheet for the year ended 31 December 2019 from the following figurers extracted from the books of Engineering Co.

Opening Inventory:

(i)Raw Materials-Rs40,350, (ii) Work-in-process-15, 000 (iii)Finished goods-35, 590

Cost incurred during the period:

Materials purchased-250, 000, Wages paid-200, 000, Carriage inward-2, 000, Consumable stores-10,000, Wages of store keeper-7, 000, Depreciation of plant & machinery-10,000, Materials destroyed by fire-5, 000, Repairs & enewals-5, 010, Office manager salary- 10,000, Salary to office staff-20,500, Printing & Stationary-10,000, Power-10,500, Lightning for office building-2, 000, Carriage inward-3, 000, Freight-5, 000, Entertainment-2,500, Warehousing charges-1, 500, Legal charges-2, 000, Expenses for participating in industrial ehgibbition-6, 000.

Closing inventory:

(i)Raw materials-35, 000, (ii) Work-in-process-14, 500 (iii) Finished goods-40, 030, Profit 25% on cost.

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