- An item that cannot be included in cost accounting is the profit or loss on the sale of fixed assets.
- Cost accounting means recording all the business transactions which are related to the cost or the cost incurred in a business.
- This type of accounting helps to determine the actual cost which was incurred for the manufacturing of a product or a service.
- All types of costs like rent, depreciation, and other expenses are recorded in cost accounting.
- Cost accounting is very important for business as it helps to understand analyze and improve efficiency by controlling the cost.
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Answer:
Loss on sale of fixed assets will not appear in cost accounting. Debit cash for the amount received, debit all accumulated depreciation, debit the loss on sale of asset account, and credit the fixed asset.
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New questions in Accountancy
Supplement C: Q2. Sharpe Cutter is a small company that produces specialty knives for paper cutting machinery. The annual demand for a particular type…of knife is 100,000 units. The demand is uniform over the 250 working days in a year. Sharpe Cutter produces this type of knife in lots and, on average, can produce 450 knives a day. The cost to set up a production lot is $300. and the annual holding cost is $1.20 per knife. a. Determine the economic production lot size (ELS). b. Determine the total annual setup and inventory holding cost for this item. c. Determine the TBO, or cycle length, for the ELS. d. Determine the production time per lot.
Q.19 On 31st December 2021, the Cash Book of Raman & Sons showed a balance of Rs. 2,500 at Bank. They sent cheques amounting to Rs. 13,500 for col…lection before 31st December, but it seems from the Pass Book that cheques for Rs. 8,500 had been credited by this date. Similarly, they issued cheques for Rs. 9,800 in the month of December, but cheques for Rs.1,350 were presented in January, 2022. The pass book revealed that bank collected dividend on securities Rs.1,000 as Per standing instruction. Bank also charged Rs.210 as incidental charges. Both of these entries were not passed in the Cash Book. Prepare Bank Reconciliation Statement as on 31st December, 2021.
Q.29 Gupta Industries purchased a machine on 1st July, 2019 for Rs. 3,00,000. On 1st january, 2021, it bought another machine for Rs. 2,00,000. On 1st…August, 2021, machine bought in 2019 was sold for Rs. 1,60,000. Another machine was bought for Rs. 1,50,000 on 1st October, 2021. It was decided to provide depreciation @ 10% p.a. on written down value method assuming books are closed on 31st March each year. Prepare Machinery A/C.
Ruby-Star Incorporated is considering two different vendors for one of its top-selling products, which has an average weekly demand of 50 units and is…valued at $75 per unit. Inbound shipments from vendor 1 will average 350 units with an average lead time (including ordering delays and transit time) of 2 weeks. Inbound shipments from vendor 2 will average 500 units with an average lead time of 1 week. Ruby-Star operates 52 weeks per year; it carries a 2-week supply of inventory as safety stock and no anticipation inventory. a. What would be the average aggregate inventory value of this product if Ruby-Star used vendor 1 exclusively? b. What would be the average aggregate inventory value of this product if Ruby-Star used vendor 2 exclusively? c. How would your analysis change if average weekly demand increased to 100 units per week?
Assertion (A): Outstanding expenses given in the Trial balance should be added with the concerned expenses account in the debit side of profit and los…s account. Reason®: Outstanding expenses will be treated as a liability in the balance sheet. T
