The Profit and Loss A/c of XYZ Ltd. for the year ended 31st March, 2007 was as follows:

The Profit and Loss A/c of XYZ Ltd. for the year ended 31st March, 2007 was as follows:

Profit and Loss A/c for the Year ended 31st March 2007

Particulars

Amount – Rs.

Particulars

Amount – Rs.

To Materials

4, 80, 000

By Sales

9, 60, 000

To Wages

3, 60, 000

By Work-in-progress

To Direct Expenses

2, 40, 000

Materials

30, 000

To Gross Profit

1, 20, 000

Wages

18, 000

Direct Expenses

12, 000

By Closing Stock

1, 80, 000

Total

12, 00, 000

Total

12, 00, 000

To Administration Expenses

60, 000

By Gross Profit

1, 20, 000

To Net Profit

66, 000

By Dividends Received

6, 000

Total

1, 26, 000

Total

1, 26, 000

As per the cost records, the direct expenses have been estimated at a cost of Rs.30 per kg and administration expenses at Rs.15 per kg. During the year production was 6000 kg and sales were 4 800 kg. Prepare a statement of Costing Profit and Loss A/c and reconcile the profit with financial profit.

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