The Meaning of Cost Sheet. (Cost Accounting)
Cost sheet is a statement of cost. In other words, when costing information are set out in the form of a statement, it is called cost sheet. It is usually adopted when there is only one product is produced and all costs are incurred for that product only. Cost sheet may be prepared for a week, monthly, quarterly or yearly indicating various components of cost as prime cost, works cost, cost of production, cost of goods sold, total cost and also profitability on a production.
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The preparation of cost sheet depends on the cost data provided by cost accounting. Due to differences in the nature of cost data there are three different cost sheet Performa may be used.
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(a) Cost sheet with break up cost: These types of cost sheet contains two column as total cost, cost per unit of out put. A specimen of cost sheet with imaginary figure.
(b) Cost Sheet with treatment of Stock: This type of cost sheet is maintained in case of manufacturing concern. Generally there are three types of stock as (1) Stock of Raw material, (2) Stock of work in progress and (3) Stock of finished goods. The treatment of stock in cost sheet has been given in a separate Performa.
(c) Estimated cost sheet or price quotation: Price quotation means quoting the minimum price for obtaining a specific order. The quotation is send in the form or estimated cost sheet having one column. In estimated cost sheet all elements of cost and overhead expenses are calculated in the following manner.
- Estimated direct material
- Estimated labor cost
- Estimated overheads