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    1. The material ledger card for Leather Bag Manufacturing Company for April 2019 is provided using the weighted average costing method. Transactions for material purchases and issues are listed with the calculation of balances, unit costs, and total amounts. 2. The cost of goods sold statement shows the normal and actual cost of goods sold. At normal levels, the cost of goods sold is Rs. 58,635 and at actual levels considering overhead under applied of Rs. 20,000, the cost of goods sold is Rs. 78,635. 3. The question required preparation of the material ledger card and cost of goods sold statement along with calculations and formatting of tables.

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    1. The material ledger card for Leather Bag Manufacturing Company for April 2019 is provided using the weighted average costing method. Transactions for material purchases and issues are listed with the calculation of balances, unit costs, and total amounts. 2. The cost of goods sold statement shows the normal and actual cost of goods sold. At normal levels, the cost of goods sold is Rs. 58,635 and at actual levels considering overhead under applied of Rs. 20,000, the cost of goods sold is Rs. 78,635. 3. The question required preparation of the material ledger card and cost of goods sold statement along with calculations and formatting of tables.

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
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    237 views2 pages

    Cost Accounting Assignment Solution

    Uploaded by

    Bhatti Khan
    1. The material ledger card for Leather Bag Manufacturing Company for April 2019 is provided using the weighted average costing method. Transactions for material purchases and issues are listed with the calculation of balances, unit costs, and total amounts. 2. The cost of goods sold statement shows the normal and actual cost of goods sold. At normal levels, the cost of goods sold is Rs. 58,635 and at actual levels considering overhead under applied of Rs. 20,000, the cost of goods sold is Rs. 78,635. 3. The question required preparation of the material ledger card and cost of goods sold statement along with calculations and formatting of tables.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
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    of 2

    Course Code MGT402

    Assignment 01
    Marks 15
    Due Date: May 17 to May 23, 2019

    Topics to be covered: Inventory Costing Method, Cost of goods sold Statement

    Question

    Material ledger card of Leather Bag Manufacturing Company for the month of
    April shows the following transactions on:

    April 1: Company had 1,300 kg material @ Rs. 10 per kg.


    April 4: Purchased material of 1,800 kg @ Rs. 11 per kg.
    April 13: Issued 2,200 kg material
    April 19: purchased material of 1,700 kg @ Rs. 12 per kg
    April 29: Issued 900 kg material

    Additional Information:
    During the period 600 direct labor hours incurred in factory. Direct labor was Rs.
    20,000 and factory overhead applied rate was Rs. 50 per direct labor hour.
    Ending inventory in finished goods and work in process were Rs. 13,000 and
    Rs.12, 000 respectively. There was no beginning inventory.

    Required:
    1. Prepare Material Ledger Card by using Weighted Average Costing under
    perpetual inventory method.
    Note: In case of cost computation; use two decimal places where
    necessary.

    2. Prepare Cost of Goods Sold Statement at normal and at actual if actual


    factory overhead was Rs. 50,000 for the month of April.

    Solution
    Marks:
    1+4*2+1
    Leather Bag Manufacturing Company
    Weighted Average Costing
    Date Received/Purchased Issued/used Balance
    Units Unit Amount Units Unit Amount Units Unit Amount
    Cost Cost Cost
    (Rs) (Rs) (Rs)
    April 1 1,300 10 13,000
    April 4: 1,800 11 19,800 3,100 10.58 32,800
    April 13 2,200 10.58 23,276 900 10.58 9,524
    April 19 1,700 12 20,400 2,600 11.51 29,924
    April 29 900 11.51 10,359 1,700 11.51 19,565

    Cost of material used = 23,276+ 10,359=33,635

    Marks 4 for working + 1 mark for formatting

    Leather Bag Manufacturing Company


    Cost of Goods Sold Statement

    Rs. Formatted Table


    Direct material 33,635
    Direct labour 20,000
    FOH applied 30,000 (600@ Rs.50)
    Total factory cost 83,635
    +opening WIP 0
    - ending WIP 12,000
    Cost of goods manufactured at 71,635
    normal
    + opening Finished Goods 0
    - ending Finished Goods 13,000
    Cost of Goods Sold at normal 58,635
    + under applied 20,000
    Cost of Goods Sold at actual 78,635

    Adjustment: Actual FOH Rs. 50,000 - Applied FOH 30,000= Under Applied
    Rs.20, 000

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