Problem 1 (Assigned to Group 1)

A manufacturer has shown an amount of Rs. 16190 in his books as “establishment” which
includes the following expenses:

 Agents commission-- Rs. 5750  Rent, rates and insurance of

 Warehouse wages-- Rs. 1800 office-- Rs. 230
 Warehouse repairs-- Rs. 510  Lighting of warehouse-- Rs. 270
 Lighting of office-- Rs. 70  Printing and stationery-- Rs. 1500
 Office salaries-- Rs. 1130  Trade magazines-- Rs. 70
 Director’s remuneration-- Rs. 1400  Donations-- Rs. 150
 Traveling expenses-- Rs. 760  Bank charges-- Rs. 100
 Rent, rates and insurance of  Discount allowed-- Rs. 1970
warehouse Rs. 310  Bad debts-- Rs. 170

From the above information, prepare a statement showing the following (in separate totals):
 Selling expenses
 Distribution expenses
 Administration expenses
 Expenses which you will exclude form total cost

Problem 2 (Assigned to Group 2)

ABC Ltd., a manufacturing company, incurred the following expenses during a certain
period. You are required to prepare a statement showing the subdivision of total cost.

Particulars Amount Particulars Amount

Materials used on jobs 1,20,540 Depreciation of plant 3,800
Wages traceable to jobs 86,650 Depreciation of delivery vans 1,600
Wages paid to men for maintenance 12,600 Insurance on finished goods 2,500
Work Salaries of sales men 15,100 Lubrication oil 250
Directors’ fees 10,000 Bad debts 300
Carriage inwards on raw materials 860 Commission to salesmen 2,850
Carriage outwards 2,800 Cost of idle time in factory 510
Factory rent and rates 8,300 Auditors fees 3,800
Works salaries 20,400 Dividends paid 6,800
Hire of crane for job no, 132 1,300 Lighting of showroom 1,500
Consumable stores 340 Office salaries and Expenses 7,000
Sales 4,00,000 Income Tax 8,600
Problem 3 (Assigned to Group 3)

The following figures are taken from the books of a manufacturing company for the year
ended on March 31, 2016. Prepare a cost sheet showing clearly the cost per unit under the
various elements and also the profit or loss per unit.

Particulars Amount Particulars Amount

Direct Materials 25,00,000 Branch Office Expenses 30,000
Direct Labour 8,00,000 Depreciation of office building 10,000
Depreciation of Factory Building 16,000 Depreciation of staff cars 15,000
Insurance: Electricity (including Rs. 5,000
35,000
Staff Cars 2,000 for administrative office)
Office Building 1,500 Advertisement 18,000
Factory Building 2,000 Sundry Factory Expenses 4,20,000
Delivery Van - Maintenance and Running
Expenses 12,000 Sales Promotion 4,000
Salaries (including that of Sales Manager
Rs. 20,000 and Factory Chief engineer 60,000
2,75,000
Rs. 25,000) Office Administration Expenses
Expenses for participating in
8,000
Finished Goods warehouse expenses 15,000 Industrial exhibition
Sales (10,000 Units) 50,000
Production during the financial Year 2015-16 was 10,000 Units

Problem 4: (Assigned to Group 4)

The All-India Mobile Phone Manufacturers Ltd. Manufacturing and Sold 850 Mobile Phones in the
year ending 31st March 2017. The summarized Trading and Profit and Loss account is given below:

Particulars Rs. Particulars Rs.

To Cost of Materials 64,000 By sales 3,20,000

To Direct Wages 96,000

To Manufacturing
expenses 40,000

To Gross Profit 1,20,000

3,20,000 3,20,000

To Office Salaries 48,000 By Gross Profit b/d 1,20,000

To Rent, Rates and Taxes 8,000

To Selling expenses 16,000

To General Expenses 24,000

To Net Profit
 24,000

1,20,000 1,20,000

For the year ending 31st March, 2018 it has been estimated that:

(a) Output and Sales will be 1,000 Mobile Phones.

(b) Price of materials will rise by 25% on the previous year’s level.
(c) Wages will rise by 12.5%.
(d) Manufacturing expenses will rise in proportion to the combined cost of materials and
wages.
(e) Selling expenses per unit will remain unaffected by the raise in the output.
(f) Other expenses will remain unaffected by the raise in the output.

You are required to Prepare:

(1) Cost Sheet for the year ended 31st March 2017
(2) Estimated Cost sheet for the year ended 31st March 2018, showing the price at which
the Mobile Phones would be marked so as to show a profit at 12% on the selling
price.

Problem 5 (Assigned to Group 5)

The following information is given to you from which you are required to prepare Cost Sheet
for the period ended on 31St march 2016:

Consumable material: Rs.

Opening stock 20,000
Purchases 1,22,000
Closing stock 10,000

Direct wages 36,000

Direct Expenses 24,000
Factory overheads 50 % of direct wages
Office and administration overheads 20% of works cost
Selling and distribution expenses Rs.3 per unit sold

Units of finished goods:

In hand at the beginning of the period (Value Rs. 12500) 500 Units
Units produced during the period 12,000 Units
In hand at the end of the period 1,500 Units
Find out the selling price per unit if 20% profit on selling price. There is no work-in-progress
either at the beginning or at the end of the period.
Problem 6 (Assigned to Group 6)

A manufacturing company submits the following information on March 31, 2016-10-04

Particulars Amount Amount
Sales for year 2,75,000

Inventories at the beginning of the year:

Materials 3,000
Finished goods 7,000
Work in progress 4,000

Purchase of raw materials for the year

1,10,000
Direct labour
65,000
Inventories at the end of the year:
Materials
Work in progress 4,000
Finished goods 6,000
8,000
Other expenses for the year
Selling expenses @10% of sales
Factory overhead @ 60% of Direct labour
Administrative expenses @5% of sales

Prepare a statement of cost

Problem 7 (Assigned to Group 7)

From the following particulars calculate (1) Prime Cost (2) Factory Cost (3) Cost of
Production and (4) Cost of Sales:

 Direct Raw Materials Rs. 33,000  Office Stationery Rs. 900

 Depreciation of office building Rs. 1,000  Rent and rates (Office) Rs. 500
 Direct Wages Rs. 35,000  Director's Remuneration (Factory) Rs. 2,000
 Depreciation of delivery Van Rs. 200  Loose tools written off 600
 Direct Expenses Rs. 3,000  Director's Remuneration (Office) 4,000
 Bad debts Rs. 100  Output 5,000 tonnes
 Factory Rent and rates Rs. 7,500  Sales @ Rs.40 per unit
 Advertising Rs. 300  Factory Cleaning 1,000
 Indirect Wages (Factory) Rs. 10,500  Sundry Office Expenses 200
 Salaries of salesmen Rs. 1.500  Factory Stationery 750
 Factory Lighting Rs. 2,050  Water supply (Factory) 1,300
 Up keeping of delivery Van Rs. 700  Factory Insurance 1,100
 Factory Heating Rs. 1,500  Office Insurance 500
 Bank charges Rs. 100  Legal Expenses (Office) 400
 Power (Factory) Rs. 4,400  Rent of Warehouse 300
 Commission on sales Rs. 1,500  Depreciation Plant & Machinery 2,000
Problem 8 (Assigned to Group 8)
From the following informations of Mani & Co. Ltd., for the year 2003 you are required to
prepare:

(a) Prime Cost (b) Work Cost (c) Cost of Production (d) Cost of goods sold and (e) Net Profit

Particulars Amount
Stock of raw materials (1.1.2003) 50,000
Purchase of raw materials 1,70,000
Stock of raw materials (31.12.2003) 80,000
Carriage Inward 10,000
Direct Wages 1,50,000
Indirect Wages 20,000
Other Direct Charges 30,000
Office rent and rates 1,000
Factory rent and rates 10,000
Indirect consumption of materials 1,000
Depreciation on plant 3,000
Depreciation on office furniture 200
Salesmen salary 4,000
Salary to office supervisor 5,000
Other factory expenses 11,400
Other office expenses 1,800

General Manager's remunerations:

Office Rs. 4,000
Factory Rs. 8,000
SeIling Dept. 12,000

Other seIling expenses 2,000

Traveling expenses of salesmen 2,200
Carriage & Freight outward 2,000
Sales 5,00,000
Advertisement 4,000

Problem 9: (Assigned to Group 9)

From the books of account of M/s ZYX Enterprises, the following details have been extracted
for the year ending 31st March 2016.

Particulars Amount (in Rs.)

Stock of materials – Opening 1,88,000
Closing 2,00,000
Material purchased during the year 8,32,000
Direct Wages paid 2,38,400
Indirect wages 16,000
Salaries to administrative staff 40,000
Freight – Inward 32,000
Outward 20,000
Sales 15,79,800
Cash discount allowed 14,000
Bad debt written off 18,800
Repairs of plant and machinery 42,400
Rent, Rate and Taxes – Factory 12,000
Office 6,400
Travelling expenses 12,400
Salesmen’s salaries and commissions 33,600
Depreciation written off – Plant and Machinery 28,900
Furniture 2,400
Director’s Fees 24,000
Electricity charges (factory) 48,000
Fuel (for Boiler) 64,000
Sale of scrap 500
General charges 24,800
Manager’s Salary 48,000

The manager’s time is shared between the factory and the office in the ratio of 20:80.
From the above details you are required to prepare a cost sheet to show:
(a) Prime cost
(b) Factory Cost
(c) Cost of Production
(d) Total Cost of Goods of Goods Sold
(e) Profit

Problem 10: (Assigned to Group 10)

The Mirchi Ltd. Manufacturing and Sold 850 Machines in the year ending 31st March 2017. The
summarized Trading and Profit and Loss account is given below:

Particulars Rs. Particulars Rs.

To Cost of Materials 64,000 By sales 3,20,000

To Direct Wages 96,000

To Manufacturing
expenses 40,000

To Gross Profit 1,20,000

3,20,000 3,20,000

To Office Salaries 48,000 By Gross Profit b/d 1,20,000

To Rent, Rates and Taxes 8,000

To Selling expenses 16,000

To General Expenses 24,000

To Net Profit 24,000

 1,20,000 1,20,000

For the year ending 31st March, 2018 it has been estimated that:

(g) Output and Sales will be 1,000 Machines.

(h) Price of materials will rise by 25% on the previous year’s level.
(i) Wages will rise by 12.5%.
(j) Manufacturing expenses will rise in proportion to the combined cost of materials and
wages.
(k) Selling expenses per unit will remain unaffected by the raise in the output.
(l) Other expenses will remain unaffected by the raise in the output.

You are required to Prepare:

(3) Cost Sheet for the year ended 31st March 2017
(4) Estimated Cost sheet for the year ended 31st March 2018, showing the price at which
the Machine would be marked so as to show a profit at 12% on the selling price.