khishen shet (ca) (277 Points)
10 June 201110,000 litres of oil were consigned to a wholesaler the cost being100 per litre by incurring freight8000. 10% of loss unavoidable. 8000 litres were sold by the consignee. the remaining stock of 1000 litres were valued at
Ans Given is 112000 plz explain
CA ADITYA SHARMA
(CA IN PRACTICE )
(16719 Points)
Replied 10 June 2011
TOTAL COST OF 10000 LTR. 1000000
+ FREIGHT 8000
- NORMAL LOSS(1000LTR)
HENCE TOTAL COST OF 9000LTR.=1008000
PERLITRE COST= 1008000/9000=112 RS.
HENCE VALUE OF CL. STOCK = 1000*112= 112000RS.
CA ADITYA SHARMA
(CA IN PRACTICE )
(16719 Points)
Replied 10 June 2011
NOTE- NORMAL LOSS WILL ONLY DECREASE THE QTY. HENCE COST OF REMAINING WILL BE INCREASED
Girish K
(Senior Accounts Executive)
(218 Points)
Replied 10 June 2011
Hi,
1st u need to calculate the Cost of the goods.. since there is an 10% unavoidable loss the cost of that loss should be included in the remaining cost... For the above answer is..
10000 Ltrs X 100 = 1000000 + 8000 = 1008000/9000 (10000 - 10% unavoidable loss) = so the cost of remaining is Rs 112 /ltr...
1000 Stocks left X Rs. 112 = 112000..
Hope you understood now.
Girish
CA CS CMA Sanjay Kumar Sareen
(Professional Faculty)
(186 Points)
Replied 10 June 2011
The Answer is simple. The cost is total qty multiplied with unit rate plus freight. Since there is unaviodable loss of 10% the total cost shall absorbed by remaing 90% units.This give you per unit cost and mutiply this with 1000 units in hand and you will get the answer. The only funda is unavoidable loss treatement.
i hope you understand it..............
rgds
Sanjay Sareen
Rajnikant Vadigoppula
(CA, CS And CMA Final)
(919 Points)
Replied 12 June 2011
yes i agree with girish and future ca
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