Download Cost of Goods Sold Solution-Accountancy, Banking and Business Administration-Assignment Solution and more Exercises Business Administration in PDF only on Docsity! SEMESTER SPRING 2012 Cost & Management Accounting (MGT-402) Assignment No. 01 Due Date: 9th April 2012 -- 12th April 2012 Marks: 20 Assignment Solution: “Cost of Goods Sold” Manufacturing cost per unit = Total manufacturing cost / No. of units manufactured = Rs. 77,625 / 40,000 Units = Rs. 1.941/unit Period Cost per unit = Total period cost / No. of units sold = Rs. 8,931 / 38,500 Units = Rs. 0.232/unit Gross profit per unit = Gross profit / No. of units sold = Rs. 11,911 / 38,500 Units = Rs. 0.3094/units Net profit per unit = Net profit / No. of units sold = Rs. 8,105 / 38,500 Units = Rs. 0.2105/unit Over / under applied Overheads Rs. Actual FOH 10,400 (-) Applied FOH 15,525 Over applied FOH 5,125 Adjustment of over applied FOH using “Net Profit” method Rs. Net profit at normal 2,980 (+) over applied FOH 5,125 Net profit at actual 8,105 docsity.com Working: Rs. Rs. Sales (38,500 x 2.25) 86,625 (-) Cost of Goods Sold Opening material (W-1) 3,700 Purchases (W-2) 20,050 Material available for use 23,750 (-) closing material (W-3) 6,200 Material consumed 17,550 (+) Direct Labor (27,000 hours @ Rs.1.65) 44,550 Prime cost 62,100 (+) FOH applied (W-4) 15,525 Total factory cost or Manufacturing cost (W-5) 77,625 (+) Opening finish good ----- Cost of goods available for sale 77,625 (-) closing finish goods (W-6) 2,911 Cost of goods sold 74,714 Gross profit (GP) 11,911 (-) Operating expenses (W-7) 8,931 Net profit at normal 2,980 W-1 (Opening material) Rs. Rs. Material-Alpha 5,000 units x Rs. 0.30 = 1,500 Material-Beta 4,000 units x Rs.0.25 = 1,000 Material-Gama 3,000 units x Rs.0.40 = 1,200 3,700 W-2 (Purchases) Rs. Rs. Material-Alpha 35,000 units x Rs. 0.35 = 12,250 Material-Beta 10,000 units x Rs. 0.30 = 3,000 Material-Gama 8,000 units x Rs. 0.60 = 4,800 20,050 W-3 (Closing material) Rs. Rs. Material-Alpha 4,000 units x Rs. 0.35 = 1,400 Material-Beta 6,000 units x Rs. 0.30 = 1,800 Material-Gama 5,000 units x Rs. 0.60 = 3,000 6,200 W-4 (FOH Cost) FOH applied = 20% of total manufacturing cost 100% FOH applied = 20% (Material cost + labor cost + FOH applied) 100% FOH applied = Material cost + labor cost + FOH applied 20% 5 FOH applied = Material + Labor + FOH applied docsity.com
