Cost Sheet and Storekeeping

Direct wages are considered an indirect cost in manufacturing a product.

Profit is estimated to be 25% on the factory cost.

The tender sheet includes details of both cost and selling price estimates for a potential project.

Fixed costs fluctuate with the level of production output.

In 'Poush 1', the opening balance is 1,200 units at Rs. 6 each.

Storage costs are considered part of direct material costs.

A cost sheet typically combines direct costs, factory overhead, and administrative overhead to arrive at the total cost of production.

Variable costs are expenses that remain constant regardless of production volume.

Factory overhead is applied to direct wages and office overhead.

In 'Poush 8', 3,000 units were issued.

Direct material costs and indirect labor costs are both considered prime costs.

The cost sheet is prepared after the tender sheet

In 'Poush 5', the business purchases 1,500 units.

Direct material costs do not include the cost of transporting the materials to the factory.

A tender sheet typically includes only direct costs and excludes overhead costs.

Cost accounting focuses primarily on external financial reporting rather than internal decision-making.

Direct wages contribute to the conversion cost of manufacturing.

The primary purpose of storekeeping is to minimize inventory levels to reduce storage costs.

Selling and distribution expenses are considered a part of factory overhead.

If the opening balance is 1,200 units at Rs. 6 each and 2,000 units are purchased, the total value of inventory is Rs. 11,200.