MGT402 Cost & Management Accounting Assignment No. 01 Semester Fall october 2011

[Vuhelper]

“Cost of Goods Sold”
Izhar Corporation is a manufacturing company which deals in furniture
manufacturing. They use job order costing system for costing the goods. The
company is a market leader and having good repute in the market. Its labor turnover
is very low because its employees and workers are quite happy and satisfied by
working for the company. During December 2010, company acquired new raw
material worth Rs. 75,000/- whereas the labor cost incurred by the department was
Rs. 31,000/- (at Rs. 2.50 per unit cost). Factory overheads (FOH) applied by the
department at the rate of Rs. 3.5 per unit. The company sold 26,300 units at the rate
of Rs. 7 per unit during the period.
Additional information
31-12- 2010 01-12-2010
Rs. Rs.
Raw Material 21,000 19,000
Labor still-in-process 6,000 6,600
Material still-in-process 6,800 6,900
FOH still-in-process 7,100 7,500
Goods in store room (Cost) ? 13,100
Goods in store room (units) 3,700 4,400
Misc. Operating Expenses --- 23,450

[Vuhelper]

idea solution not full solution

Cost of goods sold statement

Direct Material

Opening Inventory Material

Add: Net Purchases

Material Available for use

Less: Closing Inventory Material



Add: Direct Labor

Add: Factory Overhead (31000/2.5=12400 x 3.5 = 43400)

Total Factory Cost

Add: Opening WIP

Cost of goods to me manufactured

Less: Closing WIP

Cost of goods manufactured

Add: Opening F/G

Cost of goods available for sale

Less: Ending F/G (W # 1)

Cost of good sole




19000

75000

94000

21000














73000

31000

43400

147400

21000

168400

19900

148500

13100

161600

21460

140140



Income Statement

Sale (26300 x 7 )

Less: Cost of goods sold

Gross Profit

Less: Operating Exp.

Net Profit


184100

140140

43960

23450

20510



Working:

Valuation of closing F/G inventory = F/G units x Cost Per Units

= 3700 x 5.80 = 21460

Cost Per Units = CGM / No of units = 148500 / 25600 = 5.80

No of units:

Sold Units: 26300

Add: Closing units: 3700

Less: Opening Units: (4400)

25600

[l_chipko_l]

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[rabeel]

Good suggestion.

[miss leo]

very good thanks

[rabeel]

you are welcome what is ur name Leo?

[Shahid Nawaz]

I appreciate you suggestion, and I will also suggest the students who uploading these type solutions, that they may please keep the preciousness of the time of the students and not upload incomplete solution, please.

[Shahid Nawaz]

I appreciate you suggestion, and I will also suggest the students who uploading these type solutions, that they may please keep in mind the preciousness of the time of the students and not upload incomplete solution. Please don't waste the precious time of the students and help them in proper solution of the assignments and other things.

[Xpert]

you are right they are helping but most of the time students don't have time. So that's the problem.