Smart Shoe Polish Company manufactures black and brown polish in one standard size of tinretailing at Rs. 1.08 and Rs. 1.20 respectively. Following is supplied to you :ParticularsDirect Materials :Rs.Polish7,38,000Tins2,88,000Direct Wages2,44,800Production Overheads3,67,200Administrative and Selling Overheads1,22,400No. of Tins|Sales :Black Polish14,40,000Brown PolishOpening Stock Of Finished GoodsBlack PolishBrown PolishClosing Stock of Finished GoodsBlack PolishBrown Polish6,00,00048,0001,60,0001,08,00060,000The opening stock of black and brown polish was valued at its production cost of paise 80.4per tin and paise 86.4 per tin respectively. The cost of raw materials for brown polish is 10%higher than that for black but there is no difference in the cost of tins. Direct wages for brownare 8% higher than those for black polish and production overheads are considered to varywith direct wages. Administrative and selling overhead is absorbed at a uniform rate per tinof polish sold. Prepare a statement to show the cost and profit per tin of polish.

Smart Shoe polish manufactures black and brown polish Retail price of black = Rs.1.08 Retail price…

Sales : Black Polish 14,40,000 6,00,000 Brown Polish Opening Stock Of Finished Goods Black Polish Brown Polish | Closing Stock Of Finished Goods 48,000 1,60,000 Black Polish Brown Polish 1,08,000 60,000

Sales : Black Polish 14,40,000 6,00,000 Brown Polish Opening Stock Of Finished Goods Black Polish Brown Polish | Closing Stock Of Finished Goods 48,000 1,60,000 Black Polish Brown Polish 1,08,000 60,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

Smart Shoe Polish Company manufactures black and brown polish in one standard size of tin
retailing at Rs. 1.08 and Rs. 1.20 respectively. Following is supplied to you :
Particulars
Direct Materials :
Rs.
Polish
7,38,000
Tins
2,88,000
Direct Wages
2,44,800
Production Overheads
3,67,200
Administrative and Selling Overheads
1,22,400
No. of Tins
|Sales :
Black Polish
14,40,000
Brown Polish
Opening Stock Of Finished Goods
Black Polish
Brown Polish
Closing Stock of Finished Goods
Black Polish
Brown Polish
6,00,000
48,000
1,60,000
1,08,000
60,000
The opening stock of black and brown polish was valued at its production cost of paise 80.4
per tin and paise 86.4 per tin respectively. The cost of raw materials for brown polish is 10%
higher than that for black but there is no difference in the cost of tins. Direct wages for brown
are 8% higher than those for black polish and production overheads are considered to vary
with direct wages. Administrative and selling overhead is absorbed at a uniform rate per tin
of polish sold. Prepare a statement to show the cost and profit per tin of polish.

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