Internal Test Paper Solution VRPCC Mehsana

Question: 1

Stores Ledger Control Account
Particulars	Rs.	Particulars	Rs.
To Balance B/d	18000	By WIP A/c	110000
To Creditors A/c	100000	By FOH A/c	2000
		By Balance C/f	6000
	118000		118000
Wage Control Account
Particulars	Rs.	Particulars	Rs.
To Bank A/c	92000	By WIP A/c	87000
		By FOH A/c	5000
	92000		92000
Factory Overhead Account
Particulars	Rs.	Particulars	Rs.
To Wage Control A/c	5000	By WIP A/c	48000
To Stores Led. Cont.A/c	2000	By Prepaid Tax A/c	300
To Bank A/c	40000
To Prov. For Dep. A/c	1300
	48300		48300
Administration Overhead Account
Particulars	Rs.	Particulars	Rs.
To Bank A/c	12000	By Costing Profit and Loss A/c	12000
	12000		12000
Selling and Distribution Overhead Account
Particulars	Rs.	Particulars	Rs.
To Bank A/c	14000	By Cost of Sales A/c	14000
	14000		14000
Work in Progress Account
Particulars	Rs.	Particulars	Rs.
To Balance B/d	17000	By Finished Goods a/C	215000
To Wage Control A/c	87000
To Stores Led. Cont. A/c	110000
To FOH A/c	48000	By Balance C/f	47000
	262000		262000
Finished Goods Account
Particulars	Rs.	Particulars	Rs.
To Balance B/d	13000	By Cost of Sales A/c	220000
To WIP A/c	215000	By Balance C/f	8000
	228000		228000
Cost of Sales Account
Particulars	Rs.	Particulars	Rs.
To Finished Goods A/c	220000	By Debtors A/c	300000
To Selling and Dist. OH A/c	14000
To Costing Profit and Loss A/c	66000
	300000		300000
Costing Profit and Loss Account
Particulars	Rs.	Particulars	Rs.
To Admin OH A/c	12000	By Cost of Sales A/c	66000
To Profit and Loss A/c	54000
	66000		66000
Bank Account
Particulars	Rs.	Particulars	Rs.
To Balance B/d	10000	By Wages Control A/c	92000
To Debtors A/c	290000	By FOH A/c	40000
		By Admin. OH A/c	12000
		By Selling and Dist. OH A/c	14000
		By Creditors A/c	51000
		By Fixed Assets A/c	2000
		By Donations A/c	1000
		By Penalty A/c	500
		By Income Tax A/c	20000
		By Interest on Bank Loan A/c	100
		By Balance B/d	67400
	300000		300000
Debtors Account
Particulars	Rs.	Particulars	Rs.
To Balance B/d	12000	By Bank A/c	290000
To Cost of Sales A/c	300000	By Balance C/f	22000
	312000		312000
Creditors Account
Particulars	Rs.	Particulars	Rs.
To Bank A/c	51000	By Balance B/d	8000
To Balance C/f	57000	By Stores Led. Cont. A/c	100000
	108000		108000
Fixed Assets Account
Particulars	Rs.	Particulars	Rs.
To Balance B/d	55000
To Bank A/c	2000	By Balance C/f	57000
	57000		57000
Depreciation Provision Account
Particulars	Rs.	Particulars	Rs.
		By Balance B/d	5000
To Balance C/f	6300	By Factory OH A/c	1300
	6300		6300
Profit and Loss Account
Particulars	Rs.	Particulars	Rs.
To Donations A/c	1000	By Balance B/d	32000
To Penalty A/c	500	By Costing P/L A/c	54000
To Income Tax A/c	20000
To Interest on Bank Loan	100
To Balance C/f	64400
	86000		86000

Trial Balance
Name of Accounts	Dr.	Cr.
Stores Ledger Control Account	6000	-
Work in Progress Account	47000	-
Finished goods	8000	-
Debtors Account	22000	-
Creditors Account	-	57000
Bank Account	67400	-
Fixed Assets Account	57000	-
Provision of Dep. Account	-	6300
Prepaid tax	300	-
Share Capital	-	80000
Profit and Loss Account	-	64400
	207700	207700

OR

Question 2

Traditional Method
Total over heads	Rs.
Setup cost	16500
Quality Control	11000
Material Handling	5500
	33000
Overhead Recovery Rate on the basis of Direct Wages
Direct Wages	Rs.5000
6000/33000 x 100	660%

Calculation of Cost:
Particulars	D (1000 Units)		K (1000 Units)
	Total (Rs.)	Per Unit (Rs.)	Total (Rs.)	Per Unit (Rs.)
Direct Materials	12500	12.5	12500	12.5
Direct Wages	2500	2.5	2500	2.5
Overhead	16500	16.5	16500	16.5
Total Cost	31500	31.5	31500	31.5

ABC Method:
Total Overheads	Rs.33000
Total Runs	D	1
	K	10
Overheads	Rs.3000	Rs.30000

Calculation of Cost:
Particulars	D (1000 Units)		K (1000 Units)
	Total (Rs.)	Per Unit (Rs.)	Total (Rs.)	Per Unit (Rs.)
Direct Materials	12500	12.5	12500	12.5
Direct Wages	2500	2.5	2500	2.5
Overhead	3000	3	30000	30
	18000	18	45000	45