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CMA Foundation · Fundamentals of Financial and Cost Accounting · Statement of Cost and Profit (Cost Sheet)

Mehta Plastics has works cost of ₹8,00,000, office and administration overheads of ₹90,000, and sold 10,000 units after producing 10,000 units with no stock of finished goods at either date. Selling and distribution overheads are ₹60,000. What is the cost of sales per unit?

Cost of sales per unit is ₹95. Works cost of ₹8,00,000 plus administration overheads of ₹90,000 gives cost of production ₹8,90,000. Adding selling and distribution overheads of ₹60,000 gives total cost of sales ₹9,50,000, which divided by 10,000 units equals ₹95.

  1. A₹95Correct
  2. B₹80
  3. C₹89
  4. D₹100

Explanation

Cost of production = 8,00,000 + 90,000 = 8,90,000. With no finished stock change, cost of goods sold = 8,90,000, and cost of sales = 8,90,000 + 60,000 = ₹9,50,000. Per unit = 9,50,000 / 10,000 = ₹95. Option C (₹89) omits selling and distribution overheads.

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