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Workbook

[email protected] CGS (Unsolved)

98

Unit 9

CGS # 9.1: Test your understanding

1. Ascertain Cost of Goods Sold from the following figures: Opening Inventory / Stock Rs. 3,700 Purchases 20,800 Closing Inventory / Stock 2,500

CGS = OI + P - CI

2. Ascertain Cost of Goods Sold from the following figures: Opening Stock Rs. 8,500 Purchases 30,700 Direct Expenses 4,800 Indirect Expenses 5,200 Closing Inventory 9,000

CGS = OS + P + DE - CI

3. Ascertain Purchases from the following figures: Cost of Goods Sold Rs. 80,700 Opening Stock 5,800 Closing Stock 6,000

Purchases = CGS – OS + CS

4. Calculate Gross Profit from the following figures: Cost of Goods Sold Rs. 70,800 Sales 130,200

GP = Sales - CGS

5. Ascertain Gross Profit from the following figures: Opening Inventory Rs. 5,570 Purchases 13,816 Sales 15,284 Purchase Return 390 Return Inward 524 Closing Stock 8,880

GP = Net Sales + CS – OI – Net Purchases

6. From the following information extract Gross Profit and Net Profit: Beginning Inventory Rs. 2,400 Carriage in Rs. 524 Purchases 15,205 Wages 2,800 Sales 20,860 Wages Outstanding 96 Return Outward 185 Loss by fire 1,000 Return Inward 860 Indirect Expenses 200 Closing Inventory 3,840 GP = Net Sales + CI – BI – Net Purchase - Direct Expenses NP = GP – Indirect (other than Direct Expenses)

Workbook


99

Unit 9


1. Ascertain Cost of Goods Sold from the following figures:

Opening Stock Rs. 15,000

Purchases 5,000

Closing Stock 7,000

Cost of Goods Sold

2. Ascertain Gross Profit / Loss form the following figures:

Opening Inventory Rs. 12,000

Net Purchases 7,500

Sales 14,000

Closing Stock 1,500

Return Inward 2,500

Gross Loss

3. Ascertain Purchases from the following figures:

Cost of Sales Rs. 90,000

Beginning Inventory 15,000

Ending Inventory 7,000

Purchases

4. From the following information extract Gross Profit and Net Profit:


Purchases 14,000

Sales 22,000

Closing Inventory 5,500

Sales Return 1,500

Wages and Salaries 500

Financial Charges 1,500

Carriage Inward 150

Salaries Outstanding 400

Carriage Outward 100

Gross Profit

Net Profit

Workbook


100

Unit 9


1. Ascertain Cost of Goods Sold from the following figures:

Opening Stock Rs. 17,000

Purchases 4,000

Closing Stock 2,500

Cost of Goods Sold

2. Ascertain Gross Profit / Loss form the following figures:


Net Purchases 9,500

Sales 27,000

Closing Stock 5,000

Return Inward 4,500

Gross Profit

3. Ascertain Purchases from the following figures:

Cost of Sales Rs. 110,000

Beginning Inventory 45,000

Ending Inventory 26,000

Purchases

4. From the following information extract Gross Profit and Net Profit:


Purchases 7,000

Sales 33,000

Closing Inventory 7,500

Sales Return 2,000

Wages and Salaries 1,500

Financial Charges 2,500

Carriage Inward 150

Wages Outstanding 400

Carriage Outward 100

Gross Profit

Net Profit

Workbook


101

Unit 9

CGS # 9.4: The following are the figures relating to the YYY Commodity Production for the month of March, 2010.

Description Amount Description Amount Stock on 1.03.2010_ Raw Material Rs. 75,000 Stock on 31.03.2010_ Raw Material Rs. 50,000 Factory overheads 8,000 Sales 270,000 Purchases of Raw Material 100,000 Wages on Purchases 5,000 Stock on 1.03.2010_ Finished Goods 48,000 Stock on 31.03.2010_ Finished Goods 25,000 Direct Labor 12,000 Office & Admin Overhead 3,000 Return inward 10,000 Marketing Expenses 15,000 Work in process on 1.03.2010 5,000 Work in process on 31.03.2010 3,000

Requirement: Prepare statement showing Prime Cost; Conversion Cost; Total Cost; Cost of Goods Manufactured; Cost of

Goods Sold. Calculate Gross Profit; Net Profit and per unit cost by assuming that 38,000 units were produced during March.

YYY Commodity Production

Cost of Goods Sold Statement For the month ended March, 2010

Gross Profit =

Net Profit =

Per Unit Cost =

Conversion Cost =

Workbook


102

Unit 9

CGS # 9.5: These data relate to Zakar Co.'s July 2009 operations:

Materials, Beginning ………………..…… Rs. 7,000 Materials, Ending ………………..……… Rs. 9,000

WIP, Beginning ……………………………. 7,500 WIP, Ending ………………………………. 3,500

Finished goods, Beginning ………………… 10,000 Finished goods, Ending …………………… 12,000

Materials used ……………………………… 46,800 Direct Expenses ……………………….…… 400

Selling and general expenses ………………. 6,700 Direct Labour ……………………………… 8,000

Factory overhead is applied at the rate of 80% of direct labor cost.

Requirement:

Cost of materials purchased, Cost of goods manufactured, Cost of goods sold and Conversion Cost.

Zakar Company

Cost of Goods Sold Statement

For the Ended July, 2009

Cost of Goods Sold Rs. 63,200

Conversion Cost =

Workbook


103

Unit 9

CGS # 9.6: Following are data Extracted from Star Pvt. Ltd. at the end of December 31st, 2008.

Sales ………………………… Rs. 14,000,500 Sales Return ………………………….. Rs. 25,200 Purchases (Net) ……………… 2,400,000 Transportation inward ………………... 32,000 Direct Labour ……………….. 3,204,000 FOH (Total)…………………………… 1,885,600 Sales Salaries ……………….. 200,000 Advertising Expense ………………….. 155,000 Delivery Expense …………… 65,000

During the year 25,000 units were completed.

Inventories December, 2008 January, 2008

Finished Goods ……………………………… Rs. 467,400 ………………………………. Rs. 620,000 Work in Process ……………………………... 136,800 ………………………………. 129,800 Materials …………………………………….. 196,000 ………………………………. 176,000 Requirements:

(1) Total Factory Cost (2) Cost of Goods Manufactured (3) Cost of Goods Sold (4) Gross Profit and Net Profit (5) Per Unit Cost of Goods Manufactured

Star Pvt. Ltd Cost of Goods Sold Statement

For the Ended December, 2008

Cost of Goods Manufactured 7,494,600

Gross Profit =

Net Profit =

Per unit Cost of goods manufactured =

Workbook


104

Unit 9

CGS # 9.7: Following Data related to XYZ Manufacturing at the end of April, 2010.

INVENTORIES

Ending Beginning

Finished Goods ……………………………………….. 95,000 ……………………………….. ? Work in Process ………………………………………. ? ………………………………. 70,000 Direct Material ……………………………………….. 95,000 …………………………….…. 90,000 Cost incurred during the period

Cost of Goods Manufactured ……………………………..…. 574,000 Total Manufacturing Cost …………………………………… 584,000 Factory Overhead …………………………………………….. 167,000 Direct Material Used …………………………………………. 193,000

During the year 15,000 units were completed.

Requirements:

(a) Prime Cost (b) Cost of Goods Sold (c) Per Unit Cost (d) Conversion Cost

XYZ Manufacturing Cost of Goods Sold Statement

For the Ended April, 2010

Per unit Cost of goods manufactured =

Conversion Cost = Direct Labor + FOH =

Workbook


105

Unit 9

CGS # 9.8: Account Department of the ABC Co. provides the following data at end of June 2009, you are required to prepare Cost of Goods Manufactured; Cost of Goods Sold; find out Gross Profit / Loss & Net profit / Loss and Per unit Manufacturing Cost at the Year ended May 30th, 2009, assuming that Net Sales of Rs. 72,000, Marketing Expense 5%, Advertising Expense 1 % and Other Expense 3% of Net Sales; Net Purchases Rs. 36,000 and Direct Expenses are 1 % of Net Purchases; FOH 2/3 of Direct Labor and Direct Labor cost is Rs. 15,000. Units are produced during the period was 5,000. Beginning Inventories Rs Ending Inventories Rs

Finished Goods ……………………………………. 7,000 ……………………………………. 10,200 Work in Process …………………………………… 8,000 …………………………………… 15,000 Material ……………………………………………. 8,000 ……………………………………. 8,500

XYZ Manufacturing


For the Ended June, 2009


Gross Profit =

Net Profit =

Per Unit Manufacturing Cost =

Workbook


106

Unit 9

CGS # 9.9: Following data has been extracted from the books of City Company; you are required to prepare Cost of Goods

Manufactured, Cost of Goods Sold Statement, Gross Profit / Loss and Net Profit / Loss at the end of September 30th, 2009.

Stock of Raw Material (Opening) 25,000 Electricity Expense 600 Freight Inward 8,500 Selling Expenses 6,000 Freight outward 6,000 Miscellaneous Expenses 14,000 Wages 18,000 Stock of Raw Material (Closing) 2,000 Sales 418,000 Stock of Finished Goods: FOH 26,000 Opening 30,000 Return inward 5,000 Closing 40,000 Return Outward 3,500 Provision for Doubtful Debts 8,500 Factory Fuel and Power 8,000 Depreciation 4,000 Work in Process (Opening) 7,000 Purchases of Raw Material 250,000 Work in Process (Closing) 4,000 Bank Interest Received 2,600 Repairs to Office building 4,650 Direct Labor Cost 16,000

City Company


For the Ended September, 2009

Prime Cost 320,000

Cost of Goods Manufactured 349,000

Workbook


107

Unit 9


Gross Profit =

Net Profit / Loss =

CGS # 9.10: Following data has been extracted from the books of AAA Wood Company; you are required to prepare Cost of

Goods Sold Statement, Gross Profit / Loss and Net Profit / Loss at the end of June 30th, 2008.

Cash 810

Account Receivable 1,878

Allowance for doubtful accounts 90

Direct Material Inventory, July 01, 2007 375

Work-in-process, July 01, 2007 450

Finished goods, July 01, 2007 333

Carriage inward 54

Factory Equipments 5,880

Accumulated Depreciation _ Factory Equipment 1,695

Office Equipment 1,842

Accumulated Depreciation _ Office Equipment 738

Account Payable 1,113

Miscellaneous Expenses Payable 366

Capital 7,167

Net Sales 16,290

Net Purchases 3,201

Direct Labor 4,605

Factory Overheads 3,687

Selling Expenses 2,616

Administrative Expense 978

Income Tax 750

Total Rs. 27,459 Rs. 27,459

Inventory on June 30th, 2008 are

Direct Material Inventory Rs. 453; Work-in- Process Inventory Rs. 294 and Finished Goods Inventory Rs. 402

Workbook


108

Unit 9

AAA Wood Company


For the Ended June, 2008

Gross Profit =

Net Profit =

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