COST SHEET FORMAT

partivulars amount

opening stock of raw materials ₹ 1,000,000.00

purchase of RM(add) ₹ 660,000.00
purchase expense(add) ₹ 15,000.00
closing stock of RM(less) -₹ 1,165,000.00
raw mat. Consumed ₹ 510,000.00
direct wages(labour) ₹ 525,000.00
direct charges ₹ 0.00
primes cost ₹ 1,035,000.00

add: factory overheads

factory rent ₹ 150,000.00
factory [power ₹ 35,000.00
indirect materials ₹ 0.00
indirect wages ₹ 27,500.00
supervisore salary ₹ 0.00
drawing off salary ₹ 0.00
dfactory insurance ₹ 0.00
factory asset depreciation ₹ 0.00
work cost incurred ₹ 212,500.00

opening stock of wip(add) ₹ 280,000.00

closing stk of wip(less) -₹ 350,000.00
factory cost ₹ 1,177,500.00

add: administration overheads

office rent ₹ 25,000.00
asset depriciation ₹ 0.00
general charges ₹ 0.00
audit fees ₹ 0.00
bank charges ₹ 0.00
counting house salary ₹ 0.00
office expenses ₹ 0.00
cost of production ₹ 1,202,500.00

add: opening stk of finished goods ₹ 540,000.00

less: closing stock of finisjed goods -₹ 310,000.00
cost of goods sold ₹ 1,432,500.00

add: selling and distribution overhead

salesman commision ₹ 65,000.00
advaertisement ₹ 25,000.00
carriage outwards ₹ 35,000.00
cost of sales ₹ 1,557,500.00
profit ₹ 942,500.00
sales

COST SHEET OF JOSHUA AND CO FOR THE PERIODS 31st march 2018

particulars amt amt

opening stock of raw materials 12500
purchases(add) 136000
closing stock of RM -8500
raw materials consumed 140000
direct wages 54000
direct expenses 12000
PRIME COST 206000
FACTORY OVERHEAD
factory overheads(add) 54000 works overhead cost 54000
WORK COST 54000
FACTORY COST 260000
ADMINISTRATION OVERHEADCOST
administration overhead(add) 52000
COST OF PRODUCTION 312000
opening stock of FG(add) 12000
closing stock of FG(less) -15000
COST OF GOODS SOLD 309000
add:selling and distribution over 26000
cost of sales 335000
profit 67000 (20% profit)
402000

year 2017

particulars amount amt primary packaging= raw m

materials used for manufacturing 110000
add:materials used for manufact 2000000
add:freight on purchase 500000
materialsconsumed 13500000
direct wages 3000000
direct expenses(chargeable expe 1000000
PRIME cost 17500000
FACTORY OVERHEAD
add: materials used in the factor 150000
factory supervisor expenses 400000
indirect expenses 200000
depreciation on factory building 350000
work overhead 1100000
FACTORY COST 18600000
add: administration overheads
materials used in office 250000
administrative expenses 300000
depreciation on office building 150000
COST OF PRODUCTION 19300000
CLOSING STOCK
COST OF GOODS SOLD
add: selling and distribution o/h
materials used during sales 300000
depreciation on delivery van 100000
van dtiver's salary 360000
advertisement 200000
bad debts 150000
COST OF SALES 20410000
PROFIT 5102500
SALES 25512500
primary packaging= raw materials packaginexpenses
determination of contribution margin and sales output
particulars classic shirt premiuim shirt executive shir
selling price per unit $75.00 $95.00 $125.00
less:variable cost per unit
tailoring cost $7.50 $9.25 $10.75
shipping cost $48.50 $58.75 $69.25
contribution $19.00 $27.00 $45.00
targeted contribution from each product line $25,000.00 $25,000.00 $25,000.00
no of units to be sold to reach the targetted contribution $1,315.79 $925.93 $555.56

but as per the case info the % of each product line out of total sales of 5600000 ias as follows
particulars classic shirt PS ESHRT
% of total sales 5% 15% 15%
each product line amount of total sales $30,000.00 $90,000.00 $90,000.00
amount of sales required to reach the targetted contribution

in case if the classicc shirt sales is withdrawn , the revenue of 30000 must be borne by other product lines

particulars premuim shirt executive shirt coat

existing amount of gtotal ssales $90,000.00 $90,000.00 $60,000.00
addes sales (loss of the producvt line withdreaw) $4,736.84 $4,736.84 $3,157.89
total ssales required for each product line $94,736.84 $94,736.84 $63,157.89

particulars classic shirt premium shirt executive shir

selling price per unit $75.00 $95.00 $125.00
less: variable cost per unit
tailoring cost $7.50 $9.25 $10.75
shipping cost $48.50 $58.75 $69.25
contribution per rate $19.00 $27.00 $45.00
contribution rate $25.33 $28.42 $36.00
variable cost rate $74.67 $71.58 $64.00

particulars
% of total sales 5% 15% 15%
each product line amount of total sales $30,000.00 $90,000.00 $90,000.00
contribution rate $25.33 $28.42 $36.00
contribution rate per unit $7,600.00 $25,578.95 $32,400.00

price incrase option for classic shirt existing assume1 assume2

selling price/unit $75.00 $90.00 $100.00
variable cost/unit $56.00 $56.00 $56.00
contribution/unit $19.00 $34.00 $44.00
contribution rate 25.33% 37.78% 44.00%
annual contribution on total sales of product line $7,600.00 $11,333.33 $13,200.00

Redistribution of remaining product lines

particulars premuim shirt executive shirt cost
existing amount of total sales $90,000.00 $90,000.00 $60,000.00
% of projected annual sales 15.79% 15.79% 10.53%

calculation of breakeven analysis premuim shirt executive shirt cost

$95.00 $125.00 $395.00

managerial implications
1.alternatives(increasing the price to each of the contribution, or dropping the pdt line to earn the contribution
2. results are alternative(1.failure 2. by dropping the pdt line, it could be apportioned with weighted average method
3. hint given in the case for the solution (weighted avg contribution margin is suggested by then)
4. findings of the solution(mention 7600,12800,9898 etc)
5.feasibility of execution(mention the dd for the pdts competitors price increaing and decreasing the pdt price,which products
 coat classic suit premium suit executive suit
$395.00 $475.00 $625.00 $850.00

$28.35 $25.50 $29.00 $33.10

$181.65 $163.50 $186.00 $211.90
$185.00 $286.00 $410.00 $605.00
$25,000.00 $25,000.00 $25,000.00 $25,000.00
$135.14 $87.41 $60.98 $41.32

COAT CS PS ESUIT
10% 15% 15% 25%
$60,000.00 $90,000.00 $90,000.00 $150,000.00

er product lines

classic shirt premuim shirt executive shirt

$90,000.00 $90,000.00 $150,000.00
$4,736.84 $4,736.84 $7,894.74
$94,736.84 $94,736.84 $157,894.74

coat classic suit premuim suit executive suit

$395.00 $475.00 $625.00 $850.00

$28.35 $25.50 $29.00 $33.10

$181.65 $163.50 $186.00 $211.90
$185.00 $286.00 $410.00 $605.00
$46.84 $60.21 $65.60 $71.18
$53.16 $39.79 $34.40 $28.82

10% 15% 15% 25%

$60,000.00 $90,000.00 $90,000.00 $150,000.00
$46.84 $60.21 $65.60 $71.18
$28,101.27 $54,189.47 $59,040.00 $106,764.71
 classic shuit premuim suit executive suit 600000 30000
$90,000.00 $90,000.00 $150,000.00 570000
15.79% 15.79% 26.32%

classic shuit premuim suit executive suit

$475.00 $625.00 $850.00

earn the contribution

weighted average method

easing the pdt price,which products products should be increased which pdt has demand now, impact of ad
 calculating product cvost using traditional costing

manufacturing cost products

widgets gadgets smidgets
direct material $100,000.00 $200,000.00 $150,000.00
direct labor $100,000.00 $300,000.00 $400,000.00
prime cost $200,000.00 $500,000.00 $550,000.00
overhead cost (200% of direct labor) $200,000.00 $600,000.00 $800,000.00
total cost $400,000.00 $1,100,000.00 $1,350,000.00
no of units manufactured $1,000.00 $1,000.00 $1,000.00
cost per unit $400.00 $1,100.00 $1,350.00

activity based overhead rate

overhead cost estimated overh cost allocatio quantity of CABactivity based overhead rates

depreciation 300000 machine hrs 3000 100

setup 700000 setup hrs 1000 700
rent 1000000 sq feet 100000 10

total overhead costs per category of product as per ABC costing

overhead cost widgets gadgerts smidgets smadgets
depreciation 50000 90000 40000 120000
setup 140000 210000 70000 280000
rent 200000 300000 100000 400000
total overhead cost 390000 600000 210000 800000

calculating product cost using ABC costing

manufacturing cost products

widgets gadgets smidgets
direct material $100,000.00 $200,000.00 $150,000.00
direct labor $100,000.00 $300,000.00 $400,000.00
prime cost $200,000.00 $500,000.00 $550,000.00
overhead cost (ABC method) $390,000.00 $600,000.00 $210,000.00
total cost $590,000.00 $1,100,000.00 $760,000.00
no of units manufactured $1,000.00 $1,000.00 $1,000.00
cost per unit $590.00 $1,100.00 $760.00
difference in cost per unit 47.50% 0.00% -43.70%

Assuming selling price based on total cost(under traditional costing method)

 widgets gadgets smidgets smadgets
cost per unit under traditional costing method 400 1100 1350 850
assumed selling price(140 % of cost) 560 1540 1890 1190
assumed profit -$30.00 $440.00 $1,130.00 -$60.00
 smadgets
$250,000.00
$200,000.00
$450,000.00
$400,000.00
$850,000.00
$1,000.00
$850.00

vity based overhead rates

per machine hr
per setup hr
rent per sq feet

r ABC costing

smadgets
$250,000.00
$200,000.00
$450,000.00
$800,000.00
$1,250,000.00
$1,000.00
$1,250.00
47.06%
 ABC METHOD OF COSTING APPORTIONMENT IN WIKERSON COMP. AS PER ACTUAL PRO
PARTCULARS VALVE PUMP FLOW CONTROTOTAL
NO. OF UNITS 7500 12500 4000

DIRECT MATERIALS $120,000.00 $250,000.00 $88,000.00 $458,000.00

DIRECT LABOUR $75,000.00 $156,250.00 $40,000.00 $271,250.00
PRIME COST(A) $195,000.00 $406,250.00 $128,000.00 $729,250.00
MANUFACTRURING O/H

COST: MACHINE RELATED EXP $112,500.00 $187,500.00 $36,000.00 $336,000.00

COST DRIVER: MACHINE HRS 3750 6250 1200 11200

COST:SETUP LABOUR $2,500.00 $12,500.00 $25,000.00 $40,000.00

COST DRIVER: PRODUCTION RUN 10 50 100 160

COST:ENG SERVICES 20000 30000 50000 100000

COST DRIVER:ENG.HRS 250 375 625 1250

COST: PACKAGING AND SHIPPING 5000 35000 110000 150000

COST DRIVER: NO. OF SHIPMENTS 10 70 220 300

COST:RECEIVING AND PROD. 11250 56250 112500 180000

COST DRIVER: NO. OF PRODUCTION 10 50 100 160

TOTAL MANUFACTURING O/H(B) $346,250.00 $727,500.00 $349,100.00 $1,535,250.00

TOTAL SALES 645000 1087500 420000 2152500
PROFIT $298,750.00 $360,000.00 $70,900.00 $617,250.00
RATE OF PROFIT $46.32 $33.10 $16.88 $28.68

ABC METHOD OF COSTING APPORTIONMENT IN WILKERSON COMPANY AS PER ORIGINA

PARTICULARS VALVES PUMPS FLOW CONTROTOTAL
NO.UNITS 7500 12500 4000

DIRECT MATERIALS $120,000.00 $250,000.00 $88,000.00 $458,000.00

DIRECT LABOUR $75,000.00 $156,250.00 $40,000.00 $271,250.00
PRIME COST(A) $195,000.00 $406,250.00 $128,000.00 $729,250.00

COST: MACHINE RELATED EXP $112,500.00 $187,500.00 $36,000.00 $336,000.00

COST DRIVER: MACHINE HRS 3750 6250 1200 11200

COST:SETUP LABOUR $44,444.44 $222,222.22 $444,444.44 $40,000.00

COST DRIVER: PRODUCTION RUN 10 50 100 160

COST:RECEIVING AND PROD. 11250 56250 112500 180000

COST DRIVER: NO. OF PRODUCTION 10 50 100 160
COST:ENG SERVICES 20000 30000 50000 100000
COST DRIVER:ENG.HRS 250 375 625 1250
N WIKERSON COMP. AS PER ACTUAL PRODUCTIVITY
COST DRIVER RATE

$30.00

$250.00

80

500

1125

N WILKERSON COMPANY AS PER ORIGINAL CAPACITY

IDLE CAPACITY COST DRIVER RATE

$22,400.00 $28.00
800

$4,444.44 $222.22
20

20000 1000
20
#DIV/0!
 income statement in contribution margin format for the fiscal year 2003,2004,2006
particulars 2003 2004 2006 2007
sales(a) 8583000 8102000 10711000 10711000
less: variable costs
COGS 4326000 4132000 5570000
sales commission 429000 405000 536000
total variable cost 4755000 4537000 6106000
contribution margin 3828000 3565000 4605000
LESS: fixed cost
salries 2021000 2081000 3215000
advertising 254000 250000 257000
admin exp 418000 425000 435000
rent 420000 420000 840000
depreciation 84000 84000 142000
misc.exp 53000 93000 122000
TOTAL FIXED COST 3250000 3353000 5011000
net income 578000 212000 -406000
no. of sales ticket 5341 5316 6897
contribution/unit 717 671 668
variable cost/unit 890 853 885
selling price per unit 1607 1524 1553
p/v ratio 0.4460 0.4400 0.4299
breakeven sales in amount(b) 7287029.78056426 7620198.03646564 11655335.7
breakeven sales in sales ticket(units) 4534.54806687565 4999.87321178121 7505.07427
roundup of above 4535 5000 7506
average sales tciket perice 1607 1524 1553
margin f safety(A-B) 1295970.21943574 481801.963534363 -944335.72
% of MS
Q2)
average sales price 1398
total sales 10482709.8738582
less: total variable cost 6639843.41017834
total contribution 3842866.46367986
sales ticket 7663.33333333333
total fixed cost 5011000
loss -1168133.53632014

reduced selling price 1398

less: variable cost/unit 885.31245469045
total fixed cost
BREAKEVEN sales in amount(b)
BREAKEVEN in sales ticket(units)
incase if the fixed cost doesn't change from 2006 to 2007 the new selling price/ ticket price must be found out by using the for
price= existing price + incremental % based on the requirement i.e., rupees 1553 - 727 = 826. the firm can decide upon eith
2003,2004,2006
 t be found out by using the formuls below.
. the firm can decide upon either incresing or decreasing within range of 800 to 900.