Illustrations · Q5
Q.From the following information relating to a manufacturing unit for the month of March 2026, prepare a Cost Sheet showing Prime Cost, Factory Cost, Cost of Production, Cost of Sales, Profit, and Sales, along with Cost per Unit at each stage. 1,000 units were produced and sold during the month.
- Direct Material Consumed: ₹40,000
- Direct Wages: ₹25,000
- Direct Expenses: ₹5,000
- Factory Overhead: ₹15,000
- Office & Administration Overhead: ₹8,000
- Selling & Distribution Overhead: ₹7,000
- Profit: 20% on Cost of Sales
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Start your 14-day free trial to unlock the full solution →Since no opening/closing stock of raw material, Work-in-Progress, or finished goods is given, the Cost Sheet is a straightforward, single-pass build-up with each successive total being the previous total plus the next cost head, and Cost per Unit obtained by dividing every total by the 1,000 units produced.
| Particulars | Total Cost (₹) | Cost per Unit (₹) |
|---|---|---|
| Direct Material Consumed | 40,000 | 40.00 |
| Direct Wages | 25,000 | 25.00 |
| Direct Expenses | 5,000 | 5.00 |
| Prime Cost | 70,000 | 70.00 |
| Add: Factory Overhead | 15,000 | 15.00 |
| Factory Cost (Works Cost) | 85,000 | 85.00 |
| Add: Office & Administration Overhead | 8,000 | 8.00 |
| Cost of Production | 93,000 | 93.00 |
| Add: Selling & Distribution Overhead | 7,000 | 7.00 |
| Cost of Sales | 1,00,000 | 100.00 |
| Add: Profit (20% on Cost of Sales) | 20,000 | 20.00 |
| Sales | 1,20,000 | 120.00 |
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