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UNIT/SINGLE OUTPUT COSTING

UNIT/SINGLE OUTPUT COSTING. DIRECT MATERIAL + DIRECT LABOUR + DIRECT EXPENSES = PRIME COST. Prime cost + Factory Overheads* = FACTORY COST * Factory Overheads

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UNIT/SINGLE OUTPUT COSTING

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  1. UNIT/SINGLEOUTPUT COSTING

  2. DIRECT MATERIAL + DIRECT LABOUR + DIRECT EXPENSES = PRIME COST

  3. Prime cost + Factory Overheads* = FACTORY COST * Factory Overheads includes factory rent, oil & water, electric power, depreciation, etc.

  4. Factory Cost + Administrative overheads* = COST OF PRODUCTION *Administrative overheads includes office rent, depreciation for office, manager salary, stationery, etc.

  5. Cost of Production + Selling Overheads* = COST OF SALES *Selling Overheads includes salesman salary, advertising, free samples, delivery charges, etc.

  6. Cost of Sales + Profit Margin = SALES

  7. Sales = Direct Materials + Direct Labour + Direct Expense + Factory overheads + Administrative overheads+ selling overheads + profit margin

  8. IMPORTANT NOTE • TRANSFER TO RESERVES • INCOME TAX • DIVIDEND • DISCOUNT ON SHARES WRITTEN OFF

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