simi (student) (28 Points)
13 June 2011hi,
i have a few doubts regarding cost sheet which are as follows:
1)how is abnormal loss of materials different from normal loss?
2)what do you mean by "estimating expenses" as far as office overhead is concerned?
3)what is the treatment of "cost of idle time in factory"?
CA ADITYA SHARMA
(CA IN PRACTICE )
(16719 Points)
Replied 13 June 2011
normal loss is that which can not be stopped. example is leakage , evaporation etc,
where abnormal loss r that which can be stopped with the efforts example- lossdue to theft, fire etc.
CA ADITYA SHARMA
(CA IN PRACTICE )
(16719 Points)
Replied 13 June 2011
normal loss will icrease only the cost i.e. only qty. will be decreased
Naveen Jiaswal
(PCS)
(100 Points)
Replied 13 June 2011
1. Normal loss is the loss which are generally uncontrolable or unavoidable. These will be tend to occur. example of normal loss is evaporation durring Boiling of milk or furniture scrap.
On the other hand Abnormal loss are controllable, hence avoidable. Example theft or fire etc. these are generally due to human error.
2. expected expenses means estimated cost of Production which are estimated on the basis of advance actual unit to be produced. in simple terms these are the prediction of cost...
3. Idle time are those for which no production are made but wages are paid.. Its teatment are as
* Normal & uncontrollable :- charged to Overhead being common in nature.
* Abnormal & controllable :- Tr. it to Costing P/L
naga kiran kumar
(Articles Completed)
(78 Points)
Replied 13 June 2011
1) Normal loss means estimated loss using previous records and experience
Abnormal loss is loss incurred over and above normal loss.
i.e., Abnormal loss = Actual loss (-) Normal Loss
3) Idle time is of two types: a)Normal idle time and b) abnormal idle time
Normal idle time is recoverd by inflating labour / overhead rate
Abnormal idle time is accounted on the basis of the reason.
Rajnikant Vadigoppula
(CA, CS And CMA Final)
(919 Points)
Replied 13 June 2011
yes i agree with navin
Vikash Kharvar
(Dy. Manager -F&A)
(469 Points)
Replied 13 June 2011
CMA. Rakesh Kataria
(Practising Cost Accountant)
(536 Points)
Replied 14 June 2011
Pl. refer Cost Accounting Standard on Material Cost (CAS6) issued by ICWAI,
Live Course on Invoice Management System (IMS) - 2nd Batch(With Recording)
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