Scribd
Upload
322 views3 pages

Cost and Management Accounting Assignment

The document provides data on raw materials, direct wages, machine hours, administration and selling overheads, units produced and sold for a standard product manufactured in April. It asks to prepare a cost sheet showing the cost per unit and profit for the month. The response provides a cost sheet with calculations showing a cost per unit of ₹102.22 and a monthly profit of ₹82,000. It also provides data on materials X and Y including usage levels, ordering quantities and delivery periods. It calculates the maximum, minimum and ordering levels for each material. Finally, it provides data on a company's monthly demand, order costs, carrying costs, and usage levels. It calculates the reorder quantity

Uploaded by

Srabon Barua
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
322 views3 pages

Cost and Management Accounting Assignment

The document provides data on raw materials, direct wages, machine hours, administration and selling overheads, units produced and sold for a standard product manufactured in April. It asks to prepare a cost sheet showing the cost per unit and profit for the month. The response provides a cost sheet with calculations showing a cost per unit of ₹102.22 and a monthly profit of ₹82,000. It also provides data on materials X and Y including usage levels, ordering quantities and delivery periods. It calculates the maximum, minimum and ordering levels for each material. Finally, it provides data on a company's monthly demand, order costs, carrying costs, and usage levels. It calculates the reorder quantity

Uploaded by

Srabon Barua
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 3

Assignment

Cost and Management Accounting


Date: May 04, 2022
Question 01:

The following data relates to the manufacture of a standard product during the
month of April:
Particulars (Amount)
Raw materials ₹ 1,80,000
Direct wages ₹ 90,000
Machine hours worked (hours) 10,000

Machine hour rate (per hour) ₹ 8


Administration overheads (general) ₹ 35,000
Selling overheads (per unit) ₹ 5
Units produced 4,000
Units sold 3,600
Selling price per unit ₹ 125

You are required to Prepare a cost sheet in respect of the above showing:
(i) Cost per unit
(ii) Profit for the month

Ans to the Que No. Q1


Particulars Calculation Total Cost Cost per (unit)
(₹) (₹)
A) Raw materials 1,80,000÷4,000 1,80,000 45.00
B) Direct wages 90,000÷4,000 90,000 22.50
C) Prime cost (A+B) 2,70,000 67.00
D) Factory overheads (10,000 hrs. × ₹ 8 per hour) ÷4,000 80,000 20.00
E) Cost of Production (C+D) 3,50,000 87.00
F) Opening Stock of FG N/A 0 --
G) Closing Stock of FG (4000 - 3600) units ×87.50 35,000 --
H) Cost of Goods Sold (E+F-G) 3,15,000 87.00
I) Administration overheads 35,000÷3,600 35,000 9.72
J) Selling overheads 3,600×₹5 18,000 5.00
K) Cost of sales (total Cost) (H+I+J) 3,68,000 102.22

ii) Profit for the Month

Particulars Calculation ₹
Sales Revenue (3,600 units @ ₹ 125) 4,50,000
Less: Cost of sales (total Cost) 3,68,000
Profit 82,000
Name: Srabon Barua
Registration No: AU/2021/0006623
Roll No: PG/13/MBABA/2021/008
Question 02:

Materials X and Y are used as follows:


Minimum usage - 50 units each per week
Maximum usage - 150 units each per week
Normal usage - 100 units each per week
Ordering quantities X = 600 units and Y = 1,000 units
Delivery period X = 4 to 6 weeks and Y = 2 to 4 weeks
Calculate for each material (i) Maximum level (ii) Minimum level and (iii) Ordering level.

Ans to The Que No: 02

Particulars Material X Material Y


i) Re-order stock level = 150 x6 150 x4
(Maximum Usage x Maximum Reorder = 900 Units = 600 Units
Period)
ii) Minimum stock level = 6+4 4+2
900-(100 x ) 600-(100 x )
2 2
Reorder level- (Average rate of consumption x
=400 Units =300 Units
Average Reorder Period)
iii) Maximum Stock level = 900+600-(50 x 4) 600+1,000-(50 x 2)
Reorder level + Reorder Quantity- (Minimum =1,300 Units =1,500 Units
Consumption x Minimum Reorder Period)

Question 03:

Ace Ltd. manufactures a product and the following particulars are collected for the year ended
March, 2013:
Monthly demand (units) 250
Cost of placing an order (₹) 100
Annual carrying cost (₹ per unit) 15
Normal usage (units per week) 50
Minimum usage (units per week) 25
Maximum usage (units per week) 75
Re-order period (weeks) 4–6
You are required to calculate:
(i) Re-order quantity
(ii) Re-order level
(iii) Minimum level
(iv) Maximum level

Name: Srabon Barua


Registration No: AU/2021/0006623
Roll No: PG/13/MBABA/2021/008
Ans to The Que No: 03

𝟐 ×𝑪𝟎 ×𝑫
i) Re-order Quantity = EOQ = √ 𝑪𝒉
Note:
Annual demand of Raw Materials for (250×12) =3000 units of finished goods
= 52 weeks ×50 (Normal usage of raw materials) =2600 units of Raw materials
𝟐 ×𝟐𝟔𝟎𝟎 ×𝟏𝟎𝟎
So, Re-order Quantity = EOQ = √ 𝟏𝟓
=186 units

ii) Re-order level of Raw Materials = Maximum re-order period x maximum usage
= (6 x 75) = 450 units

iii) Minimum level of Raw Material = Re-order level – (normal usage x average re-order
period)

𝟔+𝟒
= 450 - (50 x 𝟐
) = 200 units

iv) Maximum level of Raw Materials = Re-order level + Re-order quantity – (minimum
usage x Minimum order period.)
= 450+186 – (25 x 4) = 536 Units

Name: Srabon Barua


Registration No: AU/2021/0006623
Roll No: PG/13/MBABA/2021/008

You might also like