Page 59 - DCOM202_COST_ACCOUNTING_I

Unit 3: Cost Sheet and Unit Costing

3.6 Review Questions Notes

1. Define cost unit. Give five examples of cost unit applicable to different industries.

2. Distinguish between direct cost and indirect cost.
3. What are the components of total cost? Draw a format of cost sheet.
4. prepare the cost sheet to show the total cost of production and cost per unit of goods
manufactured by a company for the month of Jan. 2005. Also find the cost of sale and
profit.

Particulars ` Particulars `
Stock of raw materials 1.1.2005 6,000 Factory rent and rates 6,000
Raw materials procured 56,000 Office rent 1,000
Stock of raw material 31.1.2005 9,000 General expenses 4,000
Direct wages 14,000 Discount on sales 600
plant depreciation 3,000 Advertisement expenses 1,200
Loss on the sale of plant 600 Income tax paid 2,000
Sales ` 1,50,000
5. XYION Co. Ltd. is an export oriented company manufacturing internal-communication
equipment of a standard size. The company is to send quotations to foreign buyers of your
product. As the cost accounts chief you are required to help the management in the matter
of submission of the quotation of a cost estimate based on the following figures relating to
the year 1984.
Total output (in units) 20,000.

Particulars ` Particulars `
Local raw materials 20,00,000 Excise duty 4,00,000
Imports of raw materials 2,00,000 Administrative office expenses 4,00,000
Direct labour in works 20,00,000 Salary of the managing director 1,20,000
Indirect labour in works 4,00,000 Salary of the joint managing 80,000
director
Storage of raw materials and spares 1,00,000 Fees of directors 40,000
Fuel 3,00,000 Expenses on advertising 3,20,000
Tools consumed 40,000 Selling expenses 3,60,000
Depreciation on plant 2,00,000 Sales depots 2,40,000
Salaries of works personnel 2,00,000 Packaging and distribution 2,40,000

prepare the cost statement in columnar form.
6. How would you determine the cost sheet format of a company and how does it finalise the
product cost?
7. In a cost sheet, should the administration overheads come before or after the adjustments
for the opening and closing stock of finished goods? Support your answer with reason.
8. In a factory, there are two different types of hard disk drives manufactured viz SUMO
160 GB and BRAYON 320 GB models. From the following particulars, prepare the cost
sheet showing all the necessary information of cost as well as profit per USB sold. There is
no opening and closing stock.

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