From the following information, prepare a Cost Sheet for the year 2022, showing the amount of closing stock of finished goods : | Particulars | Amount (Rs.) | | --- | --- | | Finished goods on 1-1-2022 | 50,000 | | Raw materials on 1-1-2022 | 10,000 | | Work in progress on 1-1-2022 | 14,000 | | Direct wages | 1,60,000 | | Purchase of raw materials | 98,000 | | Factory overhead | 89,000 | | Finished goods on 31-12-2022 | ? | | Raw materials on 31-12-2022 | 13,000 | | Work in progress on 31-12-2022 | 78,000 | | Cost of goods sold | 1,60,000 |

> > [!TLDR] > Closing stock of finished goods on 31-12-2022 = Rs.1,70,000. > > **Step 1 — Raw materials consumed:** > > | Particulars | Amount (Rs.) | > | --- | --- | > | Raw materials (opening, 1-1-2022) | 10,000 | > | Add: Purchase of raw materials | 98,000 | > | Less: Raw materials (closing, 31-12-2022) | (13,000) | > | **Raw materials consumed** | **95,000** | > > **Step 2 — Cost Sheet for the year 2022:** > > | Particulars | Amount (Rs.) | > | --- | --- | > | Raw materials consumed | 95,000 | > | Add: Direct wages | 1,60,000 | > | **Prime cost** | **2,55,000** | > | Add: Factory overhead | 89,000 | > | Gross works cost | 3,44,000 | > | Add: Opening work-in-progress | 14,000 | > | Less: Closing work-in-progress | (78,000) | > | **Factory / Works cost = Cost of production** | **2,80,000** | > | Add: Opening finished goods (1-1-2022) | 50,000 | > | **Cost of goods available for sale** | **3,30,000** | > | Less: Cost of goods sold (given) | (1,60,000) | > | **Closing stock of finished goods (31-12-2022)** | **1,70,000** | > …

From the following information, prepare a Cost Sheet for the year 2022, showing the amount of closing stock of

Question 70 of 85

From the following information, prepare a Cost Sheet for the year 2022, showing the amount of closing stock of finished goods :

Particulars	Amount (Rs.)
Finished goods on 1-1-2022	50,000
Raw materials on 1-1-2022	10,000
Work in progress on 1-1-2022	14,000
Direct wages	1,60,000
Purchase of raw materials	98,000
Factory overhead	89,000
Finished goods on 31-12-2022	?
Raw materials on 31-12-2022	13,000
Work in progress on 31-12-2022	78,000
Cost of goods sold	1,60,000

ChseodishaCHSE Odisha Plus Two (Class 12) Commerce Board 2023Subjective· 8mImportance★★★★★est

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Closing stock of finished goods on 31-12-2022 = Rs.1,70,000.

Step 1 — Raw materials consumed:

Particulars	Amount (Rs.)
Raw materials (opening, 1-1-2022)	10,000
Add: Purchase of raw materials	98,000
Less: Raw materials (closing, 31-12-2022)	(13,000)
Raw materials consumed	95,000

Step 2 — Cost Sheet for the year 2022:

Particulars	Amount (Rs.)
Raw materials consumed	95,000
Add: Direct wages	1,60,000
Prime cost	2,55,000
Add: Factory overhead	89,000
Gross works cost	3,44,000
Add: Opening work-in-progress	14,000
Less: Closing work-in-progress	(78,000)
Factory / Works cost = Cost of production	2,80,000
Add: Opening finished goods (1-1-2022)	50,000
Cost of goods available for sale	3,30,000
Less: Cost of goods sold (given)	(1,60,000)
Closing stock of finished goods (31-12-2022)	1,70,000
…

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Same / Similar Concept — real previous-year questions on the same or a closely similar concept, not this exact question.

CBSE 2024Set ANNUAL1 mark
$Q. Rectify the underlined portions of the following sentences :$
(vii) Prime cost plus factory overhead is total cost. (underlined : total)
›Reveal solutionSolution
Correct word: Prime cost + factory overhead = WORKS cost (not total cost).

The cost sheet build-up is:

Prime cost + Factory/Works overhead = Works (Factory) cost

Works cost + Office & Administration overhead = Cost of production

Cost of production + Selling & Distribution overhead = Total cost (cost of sales) …
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CBSE 2022Set ANNUAL1 markMCQ
$Q. Cost of production is equal to :$
(a) Prime cost plus factory overheads
(b) Factory cost plus administration overheads
(c) Direct material plus direct expenses
(d) Total cost plus profit
›Reveal solutionSolution

Cost of production = Works (factory) cost + Office/Administration overheads — option (b).

The cost-sheet ladder in +2 Class-12 Cost Accounting (CHSE Odisha, NCERT/CBSE-aligned) is:

Stage Build-up
Prime cost Direct material + Direct wages + Direct expenses
Works / Factory cost Prime cost + Factory (works) overheads
Cost of production Works cost + Office/Administration overheads

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CBSE 2022Set ANNUAL1 markMCQ
$Q. Aggregate of direct material, direct wages and direct expenses is known as :$
(a) Factory cost
(b) Cost of production
(c) Total cost
(d) Prime cost
›Reveal solutionSolution

Direct material + Direct wages + Direct expenses = Prime cost — option (d).

In +2 Class-12 Cost Accounting (CHSE Odisha), prime cost is the aggregate of all direct costs:

Element
Direct material xxx
Direct wages xxx
Direct expenses xxx

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CBSE 2022Set ANNUAL1 markMCQ
$Q. Cost of sale is the sum total of :$
(a) Cost of production plus selling and distribution overheads
(b) Prime cost plus factory overheads
(c) Cost of production plus selling and distribution overheads plus % of profit
(d) Total cost minus profit
›Reveal solutionSolution

Cost of sales = Cost of production + Selling & Distribution overheads — option (a).

In the cost-sheet build-up (CHSE Odisha +2 Cost Accounting):

Stage Build-up
Cost of production Works cost + Office/Administration overheads
Cost of sales (total cost) Cost of production + Selling & Distribution overheads
Sales Cost of sales + Profit
…

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CBSE 2019Set ANNUAL1 mark
$Q. Correct the underlined portion of the following sentence: Cost of production + selling and distribution overhead = Factory cost. (underlined portion: "Factory cost")$
›Reveal solutionSolution

The underlined "Factory cost" is wrong — adding selling and distribution overhead to cost of production gives Total Cost (Cost of Sales), the last line of the cost sheet.

The cost sheet builds up in a fixed sequence (a core idea in the CHSE Odisha +2 Class-12 Cost Accounting syllabus):

Stage Build-up
Prime cost Direct material + Direct labour + Direct expenses
Factory / Works cost Prime cost + Factory (works) overhead
Cost of production Factory cost + Office & administration overhead

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Stage	Build-up
Prime cost	Direct material + Direct wages + Direct expenses
Works / Factory cost	Prime cost + Factory (works) overheads
Cost of production	Works cost + Office/Administration overheads

Element
Direct material	xxx
Direct wages	xxx
Direct expenses	xxx

Stage	Build-up
Cost of production	Works cost + Office/Administration overheads
Cost of sales (total cost)	Cost of production + Selling & Distribution overheads
Sales	Cost of sales + Profit
…

Stage	Build-up
Prime cost	Direct material + Direct labour + Direct expenses
Factory / Works cost	Prime cost + Factory (works) overhead
Cost of production	Factory cost + Office & administration overhead

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