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Details about the various Overheads

(i) Factory Overheads

Wages of ForF’e11

Factory Lightihg

Consumable Stores


Electric Power

Oil and Water

Factory Manager’s Salary

Time Keeper’s Salary

Material Transportation Expenses

Factory Rent, Factory Lighting, Employees State Insurance Contribution,

Depreciation – Factory Plant

Electric Power

Heat and Lighting

Insurance and Taxes

Miscellaneous Expenses – Factory

Plant maintenance – Stationery in Factory

 (ii) Administrative Overheads

Office Rent

Bank Charges

Telephone Charges

Salaries of Office Staff

Repairs and Renewals – Office

Depreciation on Office Building

Manager’s Salary

Director’s Fees

Office Stationery

Postage and Telegrams


Lighting of the Office

Rates and Taxes

 (iii) Selling and Distribution Overheads

Expenses on Packing Materials

Salaries of Sales Staff

Sales Manager’s Salary

Carriage Outward

Travelling Expenses


Delivery Van Expenses

Godown Rent

Distribution Department – Salaries and Expenses

Sales Commission

Sales Promotion

Depreciation of Delivery Van.

NOTE : The following expenses are excluded from cost accounts. Even though it should be given in the problem, it should not appear anywhere in the cost sheet. Because it is purely financial nature rather than costing nature.

(i) Transfer to Reserves                       (ii) Income-tax Paid

(iii) Dividend Paid                              (iv) Discount on Shares Written Off


Simplified form of Cost Sheet

Particulars                                                      Total Cost                                Cost Per Unit

                                                                                           $                                                          $

Direct Material                                                             XX                                                     XX

Direct Labour                                                               XX                                                     XX

Prime Cost                                                                     XX                                                      XX

Add : Works Overhead or factory Overhead XX                                                       XX

Works Cost                                                                    XX                                                      XX

Add : Administrative Overhead                          XX                                                      XX

Cost of Production                                                     XX                                                      XX

Add : Selling and Distribution Overheads      XX                                                      XX

Total Cost or Cost of Sales                                     XX                                                      XX

Add: Profit                                                                  XX                                                      XX

Sales                                                                              XX                                                      XX