Cost Accounting Ledgers - Cost Book Keeping, Cost Accounting Video Lecture | Cost Accounting - B Com

as on 31st March 2013 the following
balances existed in a firm's cost ledger
you have the balances in stores ledger
control account work in process control
account then finish stock ledger control
account manufacturing overhead control
account and cost ledger account with
credit balances during the next three
months the following items are OHS
finish the product at cost so much
manufacturing overhead incurred raw
materials purchased factory wages in
direct labor cost of sales material
issued to production sales returned at
cost material returned to suppliers
manufacturing overhead charge to
production you are required to pass the
journal entries right up the accounts
and schedule the balances stating what
each balance represents ok
so now so now this is the background
first let's get started with the general
interest general entries you have to
start from here because these are all
only the opening balances the first item
is finished product so how will you have
finished products only when the
production is completed that is anything
that you are creating a finished product
is possible only when you transfer it
from work in process so the finished
product is represented by the finished
stock ledger control account so that
account should be debited and this is
not possible without transfer from
working process so what can progress
account should be created to the extent
of this summer so let's capture the
first entry it is finished stock ledger
control account it will be deleted and
the amount involved is - like ten
thousand eight hundred and thirty five
and credit will be to work in progress
control account okay so that's about the
first item the second one is
manufacturing overhead incur so that
would come under manufacturing overhead
control account since it is paid or say
assumed to be credit in either way the
credit entry will not pass or will not
say cash or bank or say outstanding
rather we will credit it to cost luger
control account in non-integrated
accounting
so the second entry is manufacturing
overhead control a cone will be debited
and credit will go to cost ledger
control account and the amount is ninety
one thousand five hundred ten so that is
chicken curve number three is raw
material purchased one lakh twenty three
thousand it will be routed through in
stores ledgers and for credit it may be
either cash or credit and we will be
routing that through cost ledger control
account so item three is going to be
stores ledger control account David now
this is instead of seeing the raw
material purchased okay and credit will
go to cost ledger control account and
the amount involved is one lakh twenty
three thousand so that is taken care
number four you have factory wages fifty
thousand five thirty indirectly indirect
labor twenty-one 665 of both come under
I mean both the items would come under
say wages it means we can part both the
items under wage control account and
credit can be cash or say credit the
outstanding but it will go to cost
ledger control account so let us capture
that here item number four we just
control account debit and credit will go
to cost ledger control account and it's
going to be summation it's going to be
summation of fifty thousand five thirty
and let me have that fifty thousand five
thirty let me just correct it it's going
to be fifty thousand five hundred and
thirty plus twenty one thousand six
hundred and sixty five so we get seventy
two thousand one hundred and ninety five
now off this what is directly taken for
production is fifty five thirty and what
is indirect labor that would go to
manufacturing overhead controller
counters 21 six sixty
it means we have to credit the wages
control account and we have to debit
work-in-progress and manufacturing
overhead for the wages itself okay so as
an extension first i will debit
work-in-progress
okay work in progress control a called
debit and that would be for fifty
thousand five hundred and thirty and
credit would go to wages control account
that's for fifty thousand five thirty it
means we have the remaining twenty one
665 where the debit would go to
manufacturing overhead control account
because it is indirect in nature so
we'll say manufacturing overhead control
account debit and credit should go to
wages control account and the amount
involved is twenty one thousand six
hundred and sixty five okay so we have
taken care of that aspect then we have
cost of sales so how you can have entry
in cost of sales only by transfers from
finished products right or finished
goods it means your cost of sales oven
will be debited and you're finished
stock ledger account have to be created
so let us capture that item number five
it's going to be cost of sales account
debit amount is one lakh eighty five
thousand eight hundred and ninety and
credit should go to finish to stock
ledger account okay there is one lakh
eighty five thousand eight ninety then
we have next item material issued to
production it means to that extent work
in progress will increase and stores
ledger balance should come down so let's
capture that I to number six work in
progress control account debit that
should increase by one lakh twenty seven
thousand three hundred and fifteen and
credit should go to stores ledger
controller phone so we say to stores
let you control
code so much so that is taken care then
what is we have sales returned at cost
it means finished products are coming
back so that should be debited and cost
of sales should come down so that should
be greater so let us have item number
seven it is finished
stock ledger control account that has
been debated and cost of sales is coming
down that is created and it is five
thousand three hundred and eighty so
that is taken care anything else yeah
material returned to supplies so when
you return the material to supplies to
to that extent stores ledger control
account should come down and supplier
account should be debited here we have
supplier account in the form of cost
ledger control account right so item
number eight we have to say cost ledger
control account debit and credit should
go to stores ledger control account and
the amount involved is two thousand nine
hundred okay then we have manufacturing
overhead charge to work charge to
production it means to the extent of 77
two hundred the work-in-progress will
increase and manufacturing overhead
would decrease so will have item number
nine work-in-progress control account
debit to manufacturing overhead control
account and the amount involved is
seventy seven two hundred right so now
we have passed all the journal entries
now let us go and write up the accounts
will start one by one so this is all the
journal entries we have we start one by
one first let us have what is known as
the cost ledger controller comb so let's
go and pick up the entries that have
linked with cost ledger control account
so here if you notice you have ninety
one thousand five hundred and ten
the credit of course ledger control
account on account of manufacturing
overhead control so we'll say bye but
before that what is the opening balance
let us not forget that the opening
balance is credit of six like sixty five
thousand two hundred and twenty so let's
capture that it's going to be by balance
brought down it is six lakh sixty five
thousand two hundred and twenty okay
then the items which we have seen we
have to pick up this that is
manufacturing overhead control we say by
manufacturing overhead control account
and what is the amount let's pick up
from here it is ninety one thousand five
hundred and ten so that has been taken
care and let's check whether there are
any other entry yes we have something
some stores ledger also one lakh twenty
three thousand so we'll say buy stores
ledger control account it is this one
lakh twenty three thousand then we also
have something from wages control so
we'll say bye
we just control account and the amount
involved is this seventy two thousand
195 then let's check whether we have any
other items on the David probably let's
see we have one over here okay where it
has been debated so let's go on the
debit side we will say two stores
lecture controller code and what is the
amount involved it is this two thousand
nine hundred okay so I think more or
less we have closed this account or we
have completed let's do the totaling on
the credit side this is the total a
higher amount so carry that over here
and it means here you have a balance
951 925 - 2,900 you have balance of nine
leg 49,000 25 so we will say this is to
balance carry dog okay so this would go
to trial balance we have to keep this in
mind then the second ledger which we are
going to have a stores ledger controller
go again go to the entries and pick up
all items which have linked with the
stores ledger control account but before
that capture the opening balance what is
the opening balance it is so much 3 like
1000 435 so we'll say to balance brought
down it is 3 lakh 1435 now we should
capture all items related to that
particular account so if you notice here
you have to cost ledger controller on
one lakh twenty three thousand let's
capture that this to cost lecture
control account and the amount involved
is this one lakh twenty three thousand
let's go and check whether any other
entries we have related to stores ledger
yes on the credit work-in-progress
controller cone so we'll say by
work-in-progress control account and the
amount involved is one lakh twenty seven
three hundred and fifteen
then let's check whether we have any
other we have one more with the credit
of what cost ledger control account
so we'll say by cost ledger control
account and how much is that it is this
two thousand nine hundred
okay now let's do the totalling on the
debit side it is for like twenty four
thousand four hundred and thirty five
once here we are going to have a
balancing figure - one lakh twenty seven
minus two thousand nine hundred so the
balancing figure is two lakh
ninety four thousand two hundred and
twenty okay so this is by balance
carried on this is what going to figure
in your trial balance what are the other
accounts we have let's go and see the
journal entries we have many other
accounts like we have this finished
stock ledger then there is manufacturing
overhead control basis control work in
progress control okay then we have cost
of sales we have yeah more or less so if
we cover all this then I think we'll be
able to prepare our trial balance so
let's move to the next set of accounts
work in progress controller cone so what
are the items we have linked with work
in progress control account let's start
the first entry by finished off but
before that the opening balance opening
balance is so much one lakh twenty two
three fifty five so we'll say to balance
brought down it is one lakh twenty two
thousand three hundred and sixty five
then we'll give effect for this that is
we have to say by finish talk ledger
account to like ten thousand eight
thirty five okay so we'll say by
finished stock lecture control account
and the amount involved is let's pick up
from here it is 2 lakh ten thousand
eight hundred and thirty-five we have to
check whether there are any other
entries probably here nothing because
our focus is on working progress control
yes here it has been debited fifty
thousand five thirty with credit to
wages control account so here we say to
wages control account and the amount
involved is fifty thousand five hundred
and thirty then do we have any other
let's check yes here we have two stores
ledger control account so we have to say
to store ledger control a cone
and the amount involved is one lakh
twenty seven thousand three hundred and
fifteen then we have any other as we
have this one two manufacturing overhead
control 77 two hundred so we will say
two manufacturing overhead control
account the amount involved is this 77
200 okay so now let's do the totalling
on the debit side total works out to
three lakhs 77489 Singh figure and it is
one lakh sixty five thousand five
hundred and seventy five we say this is
by balance carried out and this is what
we are going to capture in trial balance
then we have finished stocked ledger
control account let's go and check the
opening balance first the opening
balances two like 51 945 so let's
capture the opening balance will say
opening balance to balance brought down
there's two lag 50 1945 then we will
pick up the items that has linked with
finished stock controller code if you
take this one yes finished all control
account has been debited and the credit
goes to work in progress control account
so let's capture that over here they say
to work in progress control account and
the amount involved is this much 2 lakh
10000 835 then let's check whether there
are any other items with link with
finished off ledger control account
probably here yes finish talk ledger
control account to cost of sales so
we'll say it's going to be to cost of
sales account basically the return that
is speaking
and the amount involved is 5380 okay any
other item no our focus is on finished
stock right and yeah here we have one
with a credit so it is created by
debiting the cost of sales so here we
say by cost of sales control account and
the amount involved is one lakh
eighty-five thousand eight hundred and
ninety so now let's do the totalling if
you do the totalling here you get four
like sixty eight thousand one sixty
let's carry that over here it means here
you are going to have a balance and it
is two lakh eighty two thousand two
hundred and seventy so this is nothing
but the balance carried on next there
are some more accounts you have to open
this manufacturing overhead control
account so let's get started first the
opening balance if anything yes there is
an opening balance that two on credit
okay so we'll say buy balance brought
down by balance brought down it is ten
thousand five hundred and twenty five
now let's identify the items that is
linked with this manufacturing overhead
control account one by one
yes here we have debit to cost ledger
controller code they say to cost
ledger control account and what is going
to be the amount we can pick up from
here it is this ninety one thousand five
hundred ten
okay then do we have any other accounts
linked with manufacturing overhead
control s this one with the link to
wages control account 21 665 so they say
- we just control account and it is
twenty one thousand six hundred and
sixty five then any other entries let's
check
our focus is on the manufacturing
overhead control okay
yeah probably this one that is on credit
we have to say 77 200 by debiting the
work-in-progress control okay
so we'll say by work-in-progress control
account okay
and the amount involved is this 77 200
so now let's see let's do the totalling
on the debit side the total works out to
1 lakh 13,000 170 fine we'll take that
to credit it means here we have a
balance one lakh 13,000 one 75-77
200 - ten thousand 525 so we have the
balance of 25 thousand 450 and this is
by violence carried on this is by
violence carried on and it's a balancing
figure which will take to trial values
okay then we have this wages control
account let's capture the items related
to wages control account what are the
items we have I think yeah number one
two three so all three we have to pass
now let's do that first
the first one is to cost lecture control
account to cost ledger control account
what is the amount it is 70 to 195 then
the credit goes to number one work in
progress control account and the other
one goes to manufacturing overhead
controller code okay so work in progress
controller cone what is required it is
say here fifty thousand five thirty and
for manufacturing overhead control
account the credit is twenty one
thousand six hundred and sixty five now
if you total this this should
it talent automatically okay so that has
been taken care then we have this
important cost of sales account let's
pick up the items related to cost of
sales number one here we have cost of
sales they bid to finish talk lecture
one lakh eighty five thousand eight
hundred ninety so here we say it is to
finished stock lecture control account
and what is the amount involved let's
pick up it is one lakh
eighty five thousand eight hundred and
ninety now something has been written
back which had gone back to finished
goods so we say by finished stock lead
Joe let me put it here by finished talk
let your control account and what is
going to be the amount we have somewhere
here right
it is this 5380 so we are going to have
some balancing figure for that let me do
the total total is same one lakh 85 it
means over here we have some balancing
figure and it is one lakh eighty
thousand five hundred ten okay so this
is by balance carried them so now almost
all the ledgers have been prepared let
us go and open the trial balance let's
do it one by one the first item is cost
ledger controller code this cost ledger
control account if you notice we have
closed it like this to balance carry
down it means we will have by balance
brought down will have by balance
brought on how much 9 lakh forty nine
thousand two difference so we can say
this has a credit balance okay so the
first item is cost later
control a code with a credit balance so
this should be credit and amount we can
pick up from here
let's say 9 lakh forty nine thousand
twenty five then the second account what
we have a stores ledger where we have
closed on the credit it means to balance
brought down as to like ninety four
thousand two hundred and twenty so
that's what should come here what is the
account it is stores nature control
account and the balance is two lakh 94
220 so that is taken care then the next
account what we have is work-in-progress
controller code let's write that this
work-in-progress control account let's
see whether it is debit or credit ugly
here yeah so we have written by balance
so it has to balance brought down
we have debit balance one lakh 66 575 so
that is one lakh
sixty six thousand five hundred and
seventy five similarly we have finished
stock finished stock lecture control
account and let's find out the balance
in stock ledger control account so we
have captured and credit it means it is
debit balance and the amount involved is
to like 82 to 70 so we can show that it
is this two lakh eighty two thousand two
hundred and seventy then what else we
have then we have this manufacturing
overhead control account let's capture
manufacturing overhead control account
and what is going to be the amount let's
see here we have closed with credit so
it is having debit balance will say to
balance brought down it is twenty five
thousand four hundred and fifty so we
will say it is
twenty-five thousand four hundred and
fifty and wages have been closed then
what is still pending is this cost of
sales account so we'll say cost of sales
account and let's check we have closed
with buy balance so to balance brought
down there is one lakh eighty thousand
five hundred and ten okay so let's pick
up one lakh eighty thousand five hundred
ten so now I believe we have captured
most let me check the arithmetical
accuracy by totaling the debit and
credit they would total 9 lakh forty
nine thousand twenty five credit is also
saved so we have completed the trial
balance as well