Tybcom (Chapter Wise) Recording Word File

PROF. BHAMBWANI’S

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TYBCOM (CHAPTER WISE) RECORDING WORD FILE

COST SHEET

LEC 1: (1 hour 58 mins) (Theory)

LEC 2: (24 mins) (Theory)

LEC 3: (29 Mins)

From the following particulars prepare a statement showing (a) the prime cost of goods

produced, (b) the works cost of such goods, (c) total cost of production and (d) net profit for the

month:

Rs. / Rs.
Raw Material Purchased
Direct Wages
Indirect Wages
Stock of Raw Materials
(1-9-04)
Stock of Materials
(30-9-04)
Stock of Finished Goods
(1-9-04)
Stock of Finished Goods
(30-9-04)
Work-in-Progress(1-9-04)
Work-in- Progress(30.9.04) / 66,000
52,500
2,750
75,000
91,500
54,000
31,000
28,000
35,000 / Sales
Factory
Rent, Rates & Power
Depreciation of
Plant & Machinery
Buying Expenses
Sundry Factory Expenses
Travelling, Wages
& Commission
Office Rent, Rates etc.
Sundry Office Expenses
Advertising
Carriage Outwards / 2,11,000
15,000
3,500
1,500
10,000
6,500
2,500
6,500
3,500
2,500

LEC 4: (25 Mins)

The accounts of Artistic Manufacturing Ltd. for the year ended 31st Dec., 2004 show the

following:-

Rs. / Rs.
Stock of Materials
(1-1-04)
Material Purchased
Drawing
Office Salaries
General
Office Salaries
Bad Debts written off
Travellers'Salaries & Commission
Depreciation written off on Office Furniture
Rent, Rates, Taxes & Insurance (Factory)
Productive Wages
General Expenses
Gas & Water (Factory) / 67,200
2,59,000
9,100
17,000
9,100
10,780
420
11,900
1,76,400
4,760
1,680 / Travelling Expenses
Sales
Manager's Salary
(2/3rd Factory, 1/3rd Office)
Depreciation written off on
Plant, Machinery & Tools
Cash Discount Allowed
Repairs of Plants
Machinery & Tools
Carriages Outward
Direct Expenses
Rent, Rates, Taxes
& Insurance (Office)
Gas & Water (Office)
Stock of Materials
31-12-04 / 2,940
6,45,540
15,000
9,100
4,060
6,230
6,020
10,010
2,800
560
87,920

You are required to prepare a cost sheet showing Prime Cost, Factory Cost, Total Cost, and Net Profit for the y.e. 31-12-04.

LEC 5: (36 Mins)

From the following balances extracted at 31st March 2005, prepare a statement in such form as

to ascertain:

(a) Prime cost; (b) Works Cost of manufactured goods; (c) Net profit;

(d) Percentage of Net Profit to sales.

Rs. / Rs.
Stock on 1-4-04:
Manufactured goods
Raw materials
Depreciation on Plant& machinery
Discount allowed
Printing & Stationery
Purchases:
ManufacturedGoods
Raw materials
Debtors
Cash at Bank
Repairs of Machinery
Capital / 97,400
30,000
1,30,000
37,400
9,300
1,27,400
8,72,600
2,17,400
17,100
25,000
7,78,200 / Office Salaries
Coal
Carriage in
Carriage out
General expenses
Factory Rent & Rates
Office Rent & rates
Manufacturing
Salaries & Wages
Travelling expenses
Sales
Creditors / 94,000
57,900
39,100
23,300
31,700
2,27,100
65,000
11,02,900
27,900
29,94,200
2,17,900

Stocks on 31st March 2005 were: Manufactured goods Rs.2,79,400 and raw materials Rs.20,000.

LEC 6: (22 Mins)

Prepare a statement of cost showing maximum break up. Sales for August 2004 Rs.3,00,000.

Cost of sales Rs.2,48,000.

Administrative expenses
Selling expenses
Opening stock of raw materials
Closing stock of raw materials
Work in progress:
Opening stock
Closing stock
Finished stock:
Opening stock
Closing stock / Rs.
18,000
4,000
32,000
40,000
32,000
48,000
42,000
34,000

Other information:

(1)Direct wages were 30% of prime cost.

(2)Direct expenses were 20% of prime cost.

(3)Raw materials consumed were 50% of prime cost.

(4)Factory overheads 20% of prime cost.

LEC 7: (17 Mins)

The books and records of the Sadanand Manufacturing Co. present the following data for the

month of Aug., 2004:

Direct Labour Cost Rs. 40,000 (160% of Factory Overhead)

Cost of Good Sold Rs. 1,40,000

Inventory accounts showed these opening and closing balances:

Aug.-1
Rs ... / Aug.-31
Rs ...
Raw Materials
Work-in-Progress
Finished Goods / 20,000
20,000
35,000 / 21,500
30,000
45,000

Other Data:

Selling Expenses 8,500

General & Administration Expenses 6,500

Sales for the month 1,87,500

You are required to prepare statement showing cost of goods manufactured and sold and profit earned.

LEC 8: (37 Mins)

The following figures are extracted from the Trial Balance of Gogetter Company on 30th

September, 2004:

Inventories:
Finished Stock
Raw materials
Work-in-progress
Office Appliances
Plant & Machinery
Buildings
Sales
Sales Return and Rebates
Materials Purchased
Freight incurred on Materials
Purchase Returns
Direct labour
Indirect labour
Factory Supervision
Repairs and Upkeep-Factory
Heat, Light and Power
Rates and Taxes
Miscellaneous factory Expenses
Sales Commission
Sales Travailing
Sales Promotion
Distribution Dept.- Salaries and Expenses
Office salaries and Expenses
Interest on Borrowed funds / 80,000
1,40,000
2,00,000
17,400
4,60,500
2,00,000
14,000
3,20,000
16,000
1,60,000
18,000
10,000
14,000
65,000
6,300
18,700
33,600
11,000
22,500
18,000
8,600
2,000 / 7,68,000
4,800

Further details are available as follows:

(i)Closing inventories:

Finished Goods 1,15,000

Raw Materials 1,80,000

Work-in-progress 1,92,000

(ii)Accrued expenses on:

Direct Labour 8,000

Indirect Labour 1,200

Interest on Borrowed Funds 2,000

(iii)Depreciation to be provided on:

Office appliances 5%

Plant & Machinery 10%

Buildings 4%

(iv)Distribution of the following costs:

Heat, Light and Power to Factory. Office and Distribution in the ratio 8:1:1. Rates and Taxes two-thirds to Factory and one-third to Office.

Depreciation on Building to Factory. Office and Selling in the ratio 8:1:1.

With the help of the above information, you are required to prepare a condensed Profit and Loss Statement of Gogetter Co. for the year ended 30th September, 2004 along with supporting schedules of: (1) Cost of sales. (2) Selling and Distribution Expenses (3) Administration Expenses.

LEC 9: (36 Mins)

From the following particulars of product X compile cost sheet for the month of August 2004.

Raw Material
Opening Stock
Purchases
Closing stock
Direct labour
Factory overhead
Office and Admi. Overhead / Rs.
20,000
1,50,000
10,000
60,000
22,500
27,500

Finished Stock

Opening Stock 500 unit @ Rs.11.20 per unit

Closing Stock 1,500 unit @ current cost price.

Profit on sales 20%

Selling and Distributive Expenses Rs.20,000

Units Produced 25,000.

LEC 10: (12 Mins)

The following data relates to the manufacture of a standard productduring the four weeks ended

28th February, 2004:

Raw materials consumed
Direct wages
Machine-hours worked
Machine-hour rate
Office on cost
Units produced
Units sold
Selling price per unit
Selling on cost per unit / Rs. 15,000
Rs. 9,800
Hrs. 2,300
Paise 50
10% of works cost
Units 19,030
Units 11,420
Rs. 2
Paise 10

You are required to prepare a cost sheet in respect of above showing (a) the total cost per unit and (b) the profit for the period.

LEC 11: (22 Mins)

From the following figures, prepare the cost sheet:

Opening Stock 1.1.2004:
Raw material 500 units
Finished Goods 500 units
Purchases:
Raw materials 10,000 units
Closing Stock 31.1.2004:
Raw materials 300 units
Finished Goods 700 units
Office Salaries Rent & Rates
Repairs of Plant
Printing & Stationery
Manufacturing Wages
Coal Consumed
Factory Rent, & Taxes
Commission on Sales
Selling Price was Rs.3 per unit. / Rs.
300
1,610
9,635
755
1,834
1,224
1,020
918
9,690
2,958
1,734
500

LEC 12: (36 Mins)

The Govt. of India has instituted the dual pricing system in the industry in which your

organisation operates. You are the head of the Costing Division of Raja Textiles Co. Ltd. Your

company produces a standard type of cloth, 50% of which is procured by the Govt. at a price of

Rs. 4 per metre. You are required by the Managing Director of your company to suggest a

suitable price for the cloth to be sold in the open market. Production during 2004-05 has been

20,00,000metres of cloth. Relevant information is given below:-

Amount / Amount
Cotton Consumed
Direct Labour in
Factory
Carriage Inwards
Indirect Labour
in Factory
Salary of Work -
Director & Other
Staff in Factory
Water, Power,
Local Taxes (Factory)
Dyeing, Bleaching etc.
Depreciation (Factory)
Excise & Other Taxes
Misc. Expenses
(Factory)
Salary of Managing -
Director
Office Salaries
Expenditure on
Sales Depots / 10,00,000
10,00,000
50,000
4,00,000
2,50,000
5,00,000
10,00,000
2,00,000
30,00,000
1,00,000
1,00,000
10,00,000
4,00,000 / Depreciation of
Machines (Office)
Misc. Office
Expenditure
Purchase of
Computer for Office
Misc. Purchases of
Furniture & Machines
for Office
Dividend Paid
Director's Fees
Advertising &
Publicity
Commission paid to
Sales
Commission paid to
Foreign Buyers
Packing & Forwarding
(Sales) / 1,00,000
1,00,000
20,00,000
5,00,000
12,00,000
2,00,000
10,00,000
10,00,000
1,00,000
2,00,000

Following further information is made available:

1.The company expects a fair return of 20% on its paid up capital, which is Rs. 1,00,00,000.

2. Marketing Expenses Outstanding are Rs. 1,00,000.

Suggest the opening market price after preparing a Cost Analysis Sheet.

LEC 13: (34 MIns)

From the following figures, prepare the cost sheet and show the cost of production of each unit

of the goods manufactured. Also show the profit earned.

Rs.
Opening Stock 1.12.2006
Raw Materials(500 units) / 430
Finished goods (1,000 units) / 2,590
Purchases of Raw Materials (10,000 units) / 9,600
Carriage on the above / 1,400
Closing Stock 31.12.2006
Raw Materials (300 units) / ?
Finished goods (2,000 units) / ?
Office Salaries, Rent & Rates / 1,200
Repairs & depreciation of plant & Machinery / 1,000
Printing & Stationery / 1,000
Manufacturing wages / 9,700
Coal consumed / 3,000
Factory Rent & Taxes / 1,700
Commission on sales / 900

There was 200 units of wastage during production. Selling price was Rs.4 per unit of Finished Goods and Re.0.50 per unit of scrap. Office overheads are to be inventorised.

LEC 14: (38 Mins)

C, B and D carry on business as engineers in partnership sharing profits & losses equally. C

devotes to the business only so much time he thinks fit. B acts as works manager & D as Office

Manager,. The following figures for the month of March 1999, were extracted as follows:

Rs.
Purchase of Stores / 49,000
Work Wages-Direct / 32,000
Indirect / 4,000
Office Salaries / 9,390
Carriage Inward / 300
Carriage outward / 28,000
Sales / 1,60,000
Opening Stock
Stores / 17,500
Finished Goods (600 units) / 4,500
Work-in-progress / 6,500
Travelling Expenses / 1,200
Interest on Capital - C 1,500
B 800
D 700 / 3,000
Advertising / 3,000
Power / 1,050
Income Tax / 9,500
Agent's Commission / 4,500
Plant Maintenance / 3,660
Rates & Lighting for Building (9/10 for factory) / 1,000
Discount Received / 300
Bad Debts / 500
Sundry Expenses: Factory / 1,400
Office / 2,600
Building Repairs / 100
Partner's Salaries : B 1,200
D 1,000 / 2,200
Depreciation : Plant / 1,900
Building / 800
Sales of Scrap / 400

On 31st March 1999 stores on hand totaled Rs.19,000 whereas the Work-in-Progress was estimated at Rs.7,000; 15,000 units were produced out of which 700 remained unsold. The premises is owned by the firm and the rental value of the premises is estimated to be Rs.14,400 p.a. Prepare a cost sheet and show the profit earned.

LEC 15: (5 Mins) (CONTINUE OF LEC 14 SOLUTION)

LEC 16: (24 Mins) (Theory)

LEC 17: (35 Mins)

The cost of an article at a capacity level of 5,000 units is given under `A' below. For variation of

25% in capacity above or below this level the individual expenses vary as indicated in `B' below-

`A' / Rs ... / `A'
Material Cost
Labour Cost
Power
Repairs & Maintenance
Stores
Inspection
Depreciation
Admn. Overheads
Selling Overheads / 25,000
15,000
1,250
2,000
1,000
500
10,000
5,000
3,000 / (100% varying)
(100% varying)
( 80% varying)
( 75% varying)
(100% varying)
( 20% varying)
(100% fixed )
( 25% varying)
( 50% varying)
Total Cost / 62,750
Cost Per Unit / 12.55

Find out the unit cost of the product under each individual expense at production levels of 4,000 units and 6,000 units.

LEC 18: (17 Mins) (Theory)

LEC 19: (42 Mins)

The Trading and Profit and Loss Account of Indrajit MFG. Co. for the year ending 31-12-1992 are

as follows.

Trading and Profit Loss Account

To Raw Material
Purchased
To carriage inward
To Productive wages
To Railway Freight
To Production expenses
To Gross Profit c/d / 68,000
3,000
36,000
3,000
14,000
1,30,000 / By Sales
By Closing Stock of
raw materials / 2,50,000
4,000
2,54,000 / 2,54,000
To Office salaries
To Office rent
To Other Admn. expenses
To Advertising
To Distribution
To Other Selling cost
To Commission on sales
(per unit Rs.6)
To Net Profit / 16,000
15,000
9,000
3,000
6,000
5,470
15,000
74,030 / By Gross Profit b/d
By Interest
By Discount received
By Sundry receipts / 1,30,000
10,000
1,000
2,500
1,43,500 / 1,43,500

Estimates for the year 1993 are as under:

(1)Output and sales will rise by 40%

(2)Price of material will rise by 12.5% carriage inward and railway freight will rise in proportion to output.

(3)Because of increase in output, five new workers will be recruited and each will be paid a salary of Rs.150 per month.

(4)Half the production cost in variable. Fixed cost will rise by 25%

(5)The company has purchased the rented house from 1-1-93 in respect of which the municipality has assessed rates and taxes Rs.6,000

(6)Office salaries will rise by 8%

(7)Distribution cost includes packing charge at the rate of Rs. 1 per unit.

Prepare a statement showing selling price per unit for 1993 if the sales are to be made so as to make a profit of 20% on selling price.

LEC 20: (22 Mins)

Mohini Ltd manufactured and sold 2,000 Equipments for the year ending 31st Dec 1991. The

summarised Trading & P & L a\c for the year is given below:

To cost of Materials
To Direct wages
To Manufacturing
to Gross profit / 4,00,000
6,00,000
3,00,000
2,50,000 / By sales / 15,50,000
15,50,000 / 15,50,000
To Administrative. exp.
Fixed 1,00,000
Variable 20,000
To Selling exp :
Fixed 10,000
Variable 40,000
To Net profit / 1,20,000
50,000
80,000 / By Gross profit b/d / 2,50,000
2,50,000 / 2,50,000

For the year 1992 it is estimated that :

1. The output and sales will be 2,500 equipments.

2. Price of materials will rise by 25%

3. Wages rates will rise by 10%

4. Manufacturing expenses will increase in proportion to the combined cost of materials and wages.

Prepare a statement showing price at which equipment to be manufactured in 1992 should be marked so as to show a profit of 20% on selling price.

LEC 21: (38 Mins)

The following information for the year ending 31st Dec., 1989 is taken from the books of a company manufacturing T.V. valves :-

Rs.
Materials consumed
Direct Wages
Direct Expenses
Indirect Wages
Stereo & Spares consumed
Workman's Welfare Expenses
Cost of rectifying defective works
Depreciation on Machinery
Other factory expenses
Sales of factory scrap
Administrative Staff Salaries
Other Administrative Expenses
Professional Charges, Audit Fees, Director's Fees etc.
Commission to selling agent
Neon sign Expenses
Showroom Expenses
Sales / 6,00,000
4,00,000
2,00,000
30,000
55,000
40,000
15,000
25,000
1,50,000
15,000
1,55,000
1,10,000
35,000
1,20,000
25,000
35,000
26,40,000

10,000 units had been produced and sold for the year ending 31st Dec., 1989.

For the year ending 31st Dec., 1990, the following estimates have been made:-

1.Production and Sales will be 12,000 units.

2.Material cost per unit will rise by 50%.

3.Wage rates per unit will rise by 25%.

4.Direct Expense per unit will be in the same proportion to wages as before.

5.Factory Expenses will be in the same proportion to prime cost. Administrative Overheads in the same proportion to factory cost and selling overheads in the same proportion to cost of production as before.

6.Profit desired per unit is 25% on selling price.

Prepare a cost statement showing total cost, cost per unit, total profit and profit per units for 1989 and 1990.

LEC 22: (37 Mins)

The following information is available for the year 19X3:

Material consumed per unit20 kg

Material cost per unitRs.2,000

Wage cost per unitRs.800

Other direct cost per unitRs.200

Factory overheadsRs.4,80,000

Administration overheadsRs.3,48,000

Selling expenses (including dealers commission) Rs.12,00,000

Distribution expenses per unitRs.72

Units manufactured and sold1,000

Selling price per unitRs.6,000

In the subsequent year the company plans to double its production and the following changes are anticipated:

(1)Prices of materials will go up by 20% but per unit consumption will go down by 10%.

(2)Wages cost will rise by 25%.

(3)Other direct expenses will remain the same.

(4)Factory overheads will go up by 50% over the previous year’s level.

(5)Administration overheads will change marginally and shall be Rs.4,00,000.

(6)Selling expenses will have the same percentage to sales as in the previous year.

(7)The company wants the same rate of profit on sales as in the previous year.

LEC 23: (48 Mins)

X & Y Shoe polish Company manufactures Black and Brown polish in one standard size of

tin retailing at Rs 1.00 and Rs 1.25 respectively. Following data are supplied to you

Direct Material:
Polish
Tins
Direct Wages
Production overheads
Administrative Overheads / 7,38,000
2,88,000
2,44,800
3,67,200
1,22,400

Sales for the year were Black 14,40,000 tins and Brown 6,00,000 tins. The opening and closing Stocks were

Particulars Black Brown

Opening stock 48,000 1,60,000

Closing stock 1,08,000 60,000

The opening stock of black and brown polish was valued at its production cost of paise 80.4 per tin and paise 86.4 per tin. The cost of raw material for brown polish is 10% higher than that for black but there is no difference in the cost of tins.

Direct wages for brown are 8% higher than those for black polish and Production overheads are considered to vary with direct wages. Administrative and selling overheads are absorbed at a uniform rate per tin of polish sold. Prepare a statement to show the cost and profit per tin of polish.