Preparation of Cost Sheet

                    PREPARATION OF COST SHEET

Cost Sheet or a Cost Statement is a document which provides for the assembly of estimated detailed elements of cost in respect of cost center or cost unit. The statement summarizes the cost of manufacturing a particular list of product and discloses for a particular period as follows:

•     Prime Cost = Direct Materials +Direct Labor + Direct Expenses
•     Works Cost = Prime Cost +Factory Overhead
•     Cost of Production = Factory Cost + Office and Administrative Overhead
•   Cost of Sales =Cost of Production + Selling and Distribution Overhead

Specimen of Cost Sheet:

 

Particulars	Amount	Amount
	Rs.	Rs.
Direct Materials:
Opening Stock of Raw Materials	***
Purchases	***
Carriage Inwards	***
Less: Closing Stock of Raw Materials	***
Direct Materials Consumed		***
Add: Direct Wages		***
Direct Expenses		***
PRIME COST (I)		***
Add: Works or Factory Overheads:		***
Other Factory Expenses		***
Total Factory Cost		***
Add: Opening Stock of Work in Progress	***
Less: Closing Stock of Work in Progress	***	***
WORKS COST or FACTORY COST (II)		***
Add: Office and Administrative Overheads		***
Total Cost of Production		***
Add: Opening Stock of Finished Goods	***
Less: Closing Stock of Finished Goods	***
COST OF PRODUCTION (III)		***
Add: Selling and Distribution Overheads:		***
COST OF SALES (IV)		***
SALES (V)		***
PROFIT/ LOSS (VI=V-IV)		***