STOCK OF FINISHED GOODS - Accounts and Finance for Managers

The treatment of the stock of finished goods should carried over in between the opening stock and closing stock and adjusted among them before the finding the cost of goods sold.

STOCK OF FINISHED GOODS

Illustration

The following data has been from the records of Centre corporation for the period from June 1 to June 30,2005

records of Centre corporation for the period from June 1 to June 30,2005

Cost sheet

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From the following information extracted from the records of the M/s sundaram &co Stock position of the firm

Stock position of the firm

Cost sheet

Cost of production

Note: Property tax on the plant is to included under the factory overheads. The tax is paid by the firm on the plant which is engaging in the production process.

Illustration

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.

cost of sale and profit

The number of units produced during Jan 2005 was 6,000

The stock of finished goods was 400 and 800 units on 1st Jan, 2005 and 31st Jan,2005 respectively. The total cost of the units on hand on 1st Jan 2005 is Rs.5,600. All these had been sold during the month.

The first and foremost step is to find out the cost per unit i.e. cost production per unit. The opening stock and their values are given, but at the same time the value of the closing stock is ascertained by Rs.3. The total number of units are almost

number of units

number of units

Illustration

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

cost statement

Note:

  1. Local raw materials now cost 10% more
  2. A profits margin of 20% on sales is kept
  3. The government grants subsidy of Rs. 200 per unit of exports

Prepare the cost statement in columnar form

cost statement

cost statement


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