Skip to content

CA Intermediate · Cost and Management Accounting · Cost Sheet

Kaveri Textiles reports: direct materials Rs 3,00,000; direct wages Rs 1,50,000; factory overheads Rs 90,000; opening work-in-progress Rs 40,000; closing work-in-progress Rs 55,000. Cost of production (no finished goods adjustment) is:

Factory cost is Rs 5,40,000. Adding opening work-in-progress of Rs 40,000 and deducting closing work-in-progress of Rs 55,000 gives a cost of production of Rs 5,25,000.

  1. ARs 5,25,000
  2. BRs 5,55,000
  3. CRs 5,10,000
  4. DRs 5,40,000Correct

Explanation

Factory cost = 3,00,000 + 1,50,000 + 90,000 = 5,40,000. Adjust WIP: add opening 40,000 and deduct closing 55,000 gives 5,25,000. Check: the options list 5,25,000 as the correct value, so recompute: 5,40,000 + 40,000 - 55,000 = 5,25,000. Rs 5,40,000 ignores WIP, so it is wrong.

Did you get it right without looking?

One question tells you little. A timed set on Cost Sheet shows your real accuracy, how long you take and where you lose marks.

Practise Cost SheetFree diagnostic mock

More Cost Sheet questions