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Dr. (CA) Ankita Jain: Unit - Iii

This document discusses unit costing and cost sheets. Unit costing is used in industries that produce identical products, where the cost per unit is calculated. Cost sheets are prepared to determine the cost of a product by segregating costs into categories like prime cost, factory cost, cost of production, etc. Job costing is used in job order industries where each job has unique specifications and is treated separately, with a job cost sheet prepared for each individual job rather than a time period.

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BHAVYA SHARMA
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45 views

Dr. (CA) Ankita Jain: Unit - Iii

This document discusses unit costing and cost sheets. Unit costing is used in industries that produce identical products, where the cost per unit is calculated. Cost sheets are prepared to determine the cost of a product by segregating costs into categories like prime cost, factory cost, cost of production, etc. Job costing is used in job order industries where each job has unique specifications and is treated separately, with a job cost sheet prepared for each individual job rather than a time period.

Uploaded by

BHAVYA SHARMA
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
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Dr.

(CA) Ankita Jain


UNIT - III
Unit Costing
 It is a method of costing used by industries where
identical products are produced.
 Under this costing cost per unit is also calculated.
Unit Costing
Cost unit.

Industry or Product Cost Unit Basis


Automobile Number
Cement Ton/ per bag etc.
Chemicals Litre, gallon, kilogram, ton etc.
Power Kilo-watt hour (kWh)
Steel Ton
Transport Passenger- kilometer
Cost Sheet
 Cost sheet is prepared to determine the cost of product.
 A Cost Sheet or Cost Statement is “a document which
provides a detailed cost information by segregating the cost
into different heads like
Prime cost,
Factory cost
Cost of production,
Cost of goods sold,
Cost of sales
Cost Sheet
Particulars Total Cost Cost per unit
1. Direct materials consumed:
Opening Stock of Raw Material xxx
Add: Additions/ Purchases xxx
Less: Closing stock of Raw Material xxx
xxx
2. Direct employee (labour) cost xxx
3. Direct expenses xxx
4. Prime Cost (1+2+3) xxx
5. Add: Works/ Factory Overheads xxx
6. Gross Works Cost (4+5) xxx
7. Add: Opening Work in Process xxx
8. Less: Closing Work in Process (xxx)
9. Works/ Factory Cost (6+7-8) xxx
10. Add: Administrative Overheads xxx
11. Less: Credit for Recoveries/Scrap/By product xxx
12. Cost of Production (9+10+11) xxx
Cost of Sales
12. Cost of Production

13. Add: Opening stock of finished goods xxx


14. Less: Closing stock of finished goods (xxx)

15. Cost of Goods Sold (12+13-14) xxx


16. Add: Marketing Overheads :

Selling Overheads xxx

Distribution Overheads xxx

17. Cost of Sales (15+16) xxx

18. Profit xxx

19. Sales xxx


UNIT - III
Dr. (CA) Ankita Jain
Job Costing
 Job costing is the method of cost ascertainment used
in job order industries.
Job Order industries
 Job order Industries
 It is the industry where production work is done
against order from customers.
 Each job is completed as per customer’s specification.
 Each job work need special treatment and can be
clearly distinguished from other jobs.
 Ex.
 Printing press
 Construction of building
 Machine, tools
Job Cost Sheet
 It is the unique accounting document under Job
costing.
 It is not prepared for specific time period.
 They are made out for each job.
Cost Sheet
Particulars Total Cost
1. Direct materials consumed:
2. Direct employee (labour) cost xxx
3. Direct expenses xxx
4. Prime Cost (1+2+3) xxx
5. Add: Works/ Factory Overheads xxx
6. Works/ Factory Cost (4+5) xxx
7. Add: Administrative Overheads xxx
8. Cost of Production (6+7) xxx

9. Add: Marketing Overheads :


Selling Overheads xxx
Distribution Overheads xxx
10. Cost of Sales (9+10) xxx
11. Profit xxx
12. Sales xxx

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