BCOC-138 NUMERICAL

DECEMBER 2021
COST SHEET
PROCESS ACCOUNT
MATERIAL COST

JUNE 2022
RE ORDER LEVEL
CALCULATE THE MATERIAL COST PER UNIT
COST SHEET

DECEMBER 2022
OVERHEAD
COST SHEET
MATERIAL COST
RE ORDER LEVEL

WHAT TO DO FOR JUNE 2023

1 LEARN BASIC OF COST SHEET AND

FORMATE OF IT
2 LEARN RE ORDER LEVEL BY ANY
YOUTUBER
3 IF YOU HAVE TIME THEN GO FOR
MATERIAL COST

To prepare the cost sheet for the production of 25,000 units

of product X in the month of July 2020, we need to calculate
the total cost and cost per unit based on the given figures.
Here's how you can do it:

1. Calculate the total cost:

Total Cost = Direct Material consumed + Direct wages +

Other direct expenses + Factory overheads + Office and
Administrative overheads + Selling and Distribution
overheads

Total Cost = 2,20,000 + 1,50,000 + 45,000 + 75,000 + 65,000

+ 65,000

Total Cost = 6,20,000

2. Calculate the cost per unit:

Cost per unit = Total Cost / Number of units

Number of units = 25,000 (given)

Cost per unit = 6,20,000 / 25,000

Cost per unit = 24.8

Now we can prepare the cost sheet:

Cost Sheet for Product X (Month: July 2020)

---------------------------------------------------------------------
Particulars | Amount (in Rs.) | Amount per unit (in
Rs.)
---------------------------------------------------------------------
Direct Material consumed | 2,20,000 | 8.8
Direct wages | 1,50,000 | 6
Other direct expenses | 45,000 | 1.8
Factory overheads | 75,000 | 3
Office and Administrative| 65,000 | 2.6
overheads
Selling and Distribution | 65,000 | 2.6
overheads
---------------------------------------------------------------------
Total Cost | 6,20,000 | 24.8
---------------------------------------------------------------------

Please note that the amounts are rounded to one decimal

place in the cost per unit column.
To calculate the material cost per unit for the order executed
by the department in June 2020, we need to consider the
materials used and the relevant data for the order. Here's
how you can do it:

1. Calculate the cost per hour:

Cost per hour = (Materials used + Direct wages + Overheads)

/ Labour hours worked

Cost per hour = (60,000 + 48,000 + 38,000) / 38,000

Cost per hour = 2.7895 (rounded to four decimal places)

2. Calculate the total cost of materials for the order:

Total cost of materials = Materials used * Cost per hour

Total cost of materials = 6,500 * 2.7895

Total cost of materials = 18,141.75 (rounded to two decimal

places)

3. Calculate the number of units produced for the order

(assuming a single unit):

Number of units produced = 1

4. Calculate the material cost per unit:

Material cost per unit = Total cost of materials / Number of

units produced

Material cost per unit = 18,141.75 / 1

Material cost per unit = 18,141.75

Therefore, the material cost per unit for the order executed
in June 2020 is Rs. 18,141.75.

To complete the process account and show how abnormal

loss will be treated in accounts, let's break down the given
information and calculate the relevant values:

1. Input:
- Number of units introduced: 1500
- Cost of input: ₹15,000
- Additional expenditure: ₹5,000

2. Normal loss:
- Normal loss is expected to be one-fifth of the input.
- Normal loss = (1/5) * 1500 = 300 units

3. Scrap value:
- The scrap value of each unit is ₹1.
- Total scrap value = Scrap value per unit * Normal loss
- Total scrap value = ₹1 * 300 = ₹300

4. Actual output:
- The actual output for the period was 1000 units.

Now, let's prepare the process account:

Process Account

------------------------------------------------------------------
Particulars | Amount (in ₹) | Amount per unit (in ₹)
------------------------------------------------------------------
Input | 15,000 | 10
Additional | 5,000 | 3.33
expenditure |
------------------------------------------------------------------
Total Cost | 20,000 | 13.33
------------------------------------------------------------------
Normal Loss | | 2,000 (300 units at
₹6.67 per unit)
Abnormal Loss | | To be calculated
Actual Output | | 10,000 (1000 units at
₹20 per unit)
------------------------------------------------------------------
Total Output | | 12,000
------------------------------------------------------------------

To calculate the cost of abnormal loss, we need to consider

the difference between the expected normal loss and the
actual loss (output):

Abnormal Loss = Normal Loss - Actual Output

Abnormal Loss = 300 - 1000
Abnormal Loss = -700 units

Since the abnormal loss is negative, it means that there is

an abnormal gain of 700 units.

To calculate the value of the abnormal gain, we need to

consider the cost per unit for the normal loss:

Cost per unit for normal loss = Total Cost / Total Output
Cost per unit for normal loss = ₹20,000 / 12,000
Cost per unit for normal loss = ₹1.67

Value of abnormal gain = Cost per unit for normal loss *

Abnormal Loss
Value of abnormal gain = ₹1.67 * (-700)
Value of abnormal gain = -₹1,169 (negative value)
Therefore, the process account will show an abnormal
gain of -₹1,169 to account for the excess units produced
beyond the expected normal loss.

Explain the concept of reordering level.

Find out the reorder level from the
following data : 2+8
Maximum Stock = 6000 units
Minimum Stock = 1000 units
Time required for
receiving the material = 15 days
Daily consumption of
material = 100 units
The concept of reordering level is used in inventory
management to determine the point at which a new order
should be placed for replenishing the stock. It is the
inventory level at which a new order is initiated to avoid
stockouts and maintain an adequate supply of materials or
products.

To calculate the reorder level, we need to consider the daily

consumption rate, lead time (time required for receiving the
material), and the minimum stock level. The formula for
calculating the reorder level is:

Reorder Level = Daily consumption rate * Lead time +

Minimum stock level
Given the following data:

Maximum Stock = 6000 units

Minimum Stock = 1000 units
Time required for receiving the material = 15 days
Daily consumption of material = 100 units

Let's calculate the reorder level:

Reorder Level = (Daily consumption rate * Lead time) +

Minimum stock level
Reorder Level = (100 units/day * 15 days) + 1000 units
Reorder Level = 1500 units + 1000 units
Reorder Level = 2500 units

Therefore, the reorder level based on the given data is

2500 units. When the stock level reaches or falls below this
level, a new order should be placed to replenish the stock
and ensure that there is no disruption in the supply of
materials.

Calculate the minimum stock level from the

following data : 10
Net normal consumption = 500 units
per week
Normal reorder period = 5 weeks
Reorder level = 4000 units
To calculate the minimum stock level, we need to consider the net
normal consumption and the normal reorder period. The minimum
stock level represents the amount of stock that should be maintained
to cover the consumption during the reorder period. The formula for
calculating the minimum stock level is:

Minimum Stock Level = Net normal consumption * Normal reorder

period

Given the following data:

Net normal consumption = 500 units per week

Normal reorder period = 5 weeks

Let's calculate the minimum stock level:

Minimum Stock Level = Net normal consumption * Normal reorder

period
Minimum Stock Level = 500 units/week * 5 weeks
Minimum Stock Level = 2500 units

Therefore, the minimum stock level based on the given data is 2500
units. This means that 2500 units should be maintained in stock to
cover the consumption during the normal reorder period of 5 weeks.

From the following invoice received from a supplier,

calculate the material cost per unit : Quantity Particulars
Rate (<) Amount (<)
300 kg Material X 10·00 per kg 3,000
200 kg Material Y 12·00 per kg 2,400
5,400
Less : trade discount 270
5,130
Add :
Cost of containers (capacity of each
100 kg) 60
Cartage and Carriage 75
Octroi duty @ 0·5% 27
5,292

Terms :
(a) 5% cash discount within a week
(b) Return value of containers < 9 each

To calculate the material cost per unit, we need to consider the quantity and
total cost of materials. Here's how you can do it based on the given invoice:

1. Calculate the total cost of materials:

Total cost of Material X = ₹3,000

Total cost of Material Y = ₹2,400

Total cost of materials = Total cost of Material X + Total cost of Material Y

Total cost of materials = ₹3,000 + ₹2,400

Total cost of materials = ₹5,400

2. Apply the trade discount:

Trade discount = ₹270

Total cost after trade discount = Total cost of materials - Trade discount
Total cost after trade discount = ₹5,400 - ₹270

Total cost after trade discount = ₹5,130

3. Calculate the additional costs:

Cost of containers = ₹60

Cartage and Carriage = ₹75

Octroi duty @ 0.5% = 0.5% of ₹5,130 (total cost after trade discount)

Octroi duty = 0.5% * ₹5,130

Octroi duty = ₹25.65 (rounded to two decimal places)

Total additional costs = Cost of containers + Cartage and Carriage + Octroi

duty

Total additional costs = ₹60 + ₹75 + ₹25.65

Total additional costs = ₹160.65

4. Calculate the final total cost:

Final total cost = Total cost after trade discount + Total additional costs

Final total cost = ₹5,130 + ₹160.65

Final total cost = ₹5,290.65

5. Calculate the quantity of materials:

Quantity of Material X = 300 kg

Quantity of Material Y = 200 kg

Total quantity of materials = Quantity of Material X + Quantity of Material Y

Total quantity of materials = 300 kg + 200 kg

Total quantity of materials = 500 kg

6. Calculate the material cost per unit:

Material cost per unit = Final total cost / Total quantity of materials
Material cost per unit = ₹5,290.65 / 500 kg

Material cost per unit = ₹10.58 per kg

Therefore, the material cost per unit is ₹10.58.

Prepare (a) statement of equivalent production,

(b) statement of cost, and (c) statement of
evaluation from the following data :

Opening work in progress

(50% complete) 5000 units 11,240
Direct Material 30,000
Direct Labour 22,500

Overhead 22,500
Units introduced in process 38,000
Units finished and transfer to store 39,000
Closing work in progress
(25% complete) 4,000