China Toys Manufacturing Company Ltd.,
Cost of Goods Manufactured and Sold Statement.
For the period ended on 31st Dec, 2009
| Particulars | Rs. | Rs. |
| Direct Material | | |
| Opening Material | 8000 | |
| +Material Purchased | +90000 | |
| Material Available for use | 98000 | |
| -Closing Inventory | -43000 | |
| Material Consumed | 55000 | |
| +Direct Labour | +35000 | |
| Prime Cost 60% of C.G.M (W-3) | | 90000 |
| +FOH 30% of the Conversion (W-2) | | +15000 |
| Total Factory Cost | | 105000 |
| +Opening Work in Process | | +70000 |
| Cost of Goods to be Manufactured | | 175000 |
| -Closing Work in Process | | -25000 |
| Cost of Goods Manufactured | | 150000 |
| +Opening Finished Goods | | +50000 |
| Cost of Goods Available for | | 200000 |
| -Closing Finished Goods | | -48800 |
| Cost of Goods Sold (W-1) | | 151200 |
China Toys Manufacturing Company Ltd.,
Income Statement.
For the period ended on 31st Dec, 2009 | Particulars | Rs. | Rs. |
| | | 218800 |
| -Sales Return | | -28000 |
| Net | | 216000 |
| -Cost of Goods Sold | | -151200 |
| Gross Profit | | 64800 |
| -Selling and Administration Expenses | | |
| Selling Expenses 5% of Net | 10800 | |
| -Administration Expenses 8% of Net | 17280 | 28080 |
| Operating Profit | | 36720 |
| -Financial Expenses | | -600 |
| Net Profit | | 36120 |
(W-1)
Net Sale
Net Sale
216000= Cost of Goods Sold+30% of Sale
216000= Cost of Goods Sold+30% of 216000
216000= Cost of Goods Sold+64800
216000-64800 = Cost of Goods Sold
151200 = Cost of Goods Sold
(W-2) Reverse Calculation:-
Conversion Cost = Direct Labour + Factory Over Head
Conversion Cost =70%+30%
Conversion Cost =70%35000+30% of Conversion Cost
Total Conversion Cost = 35000*100/70
Total Conversion Cost 35000*100/70
Total Conversion Cost = 50000
Factory Overhead = 30%of 50000
Factory Overhead = 50000*30/100
Factory Overhead = 15000
Working.3:
Ending Finished Goods Inventory=?
Ending Finished Goods Inventory=
Cost of goods available for sale-Cost of Goods Sold
Ending Finished Goods Inventory= Rs.200,000-Rs.151,200
Ending Finished Goods Inventory=Rs.48800
Working.4:
Cost of Goods Manufactured=?
Cost of Goods Manufactured= Cost of goods available for sale-Opening Finished Goods Inventory
Cost of Goods Manufactured= Rs.200,000-Rs.50,000
Cost of Goods Manufactured= Rs.150,000
Working.5:
Prime Cost=?
In the given statement of Question there is Prime cost (60% of Cost of Goods Manufactured)
SO,
Prime Cost= Rs.150,000*60%
Prime Cost= Rs. 90,000
Working.6:
Total Current Factory Cost=?
Total Current Factory Cost=
Prime Cost +Factory Over Head Cost
Total Current Factory Cost= Rs.90,000+Rs.15,000
Total Current Factory Cost= Rs.105,000
Working.7:
Cost Of Goods to be Manufactured=?
Cost Of Goods to be Manufactured=
Total Current Factory Cost+ Opening Work in Process Inventory
Cost Of Goods to be Manufactured= Rs.105,000+Rs.70,000
Cost Of Goods to be Manufactured= Rs.175,000
Working.8:
Ending Work in Process Inventory=?
Ending Work in Process Inventory=
Cost Of Goods to be Manufactured-Cost Of Goods Manufactured
Ending Work in Process Inventory=Rs.175000-Rs.150,000
Ending Work in Process Inventory= Rs. 25,000
Working.9:
Direct Material used=?
Direct Material used= Prime Cost - Direct Labor
Direct Material used= Rs.90,000 – Rs.35,000
Direct Material used= Rs.55,000
Working.10:
Material Closing Inventory=?
Material Closing Inventory=
Material available for use – Total material used
Material Closing Inventory= Rs.98,000 – Rs55,00
Material Closing Inventory= Rs.43,000
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