Cost Accounting Numericals with Solutions for B.Com Students

For B.Com Students | Cost Accounting Practice

Cost Accounting is a numerical subject. You can read the theory many times, but marks come from solving problems correctly and presenting them neatly. This guide covers the most common types of cost accounting numericals B.Com students face: the cost sheet, Economic Order Quantity (EOQ), stock levels, labour cost and overhead absorption.

For hands-on practice on real data, a practical tally course in Kolkata can help you apply these concepts at work.

Each topic includes the formula, a solved example and a short practice question. Topic coverage can differ by university and semester, so match these with your own syllabus.

1. Elements of Cost — Quick Revision

Total cost is built from three elements:

Direct material + direct labour + direct expenses = Prime Cost.

2. Numerical 1 — Preparing a Cost Sheet

Question: From the following data, prepare a cost sheet showing prime cost, works cost, cost of production, cost of sales and profit.

• Opening stock of raw material ₹20,000; Purchases ₹1,30,000; Closing stock of raw material ₹30,000
• Direct wages ₹60,000; Direct expenses ₹10,000
• Factory overheads ₹40,000
• Opening WIP ₹15,000; Closing WIP ₹25,000
• Office and administration overheads ₹20,000
• Opening finished goods ₹0; Closing finished goods ₹0
• Selling and distribution overheads ₹15,000
• Sales ₹3,00,000

Solution:

Profit as a percentage of sales = 45,000 ÷ 3,00,000 × 100 = 15%.

3. Numerical 2 — Economic Order Quantity (EOQ)

EOQ is the order size that minimises the total of ordering cost and carrying cost.

EOQ = √(2 × A × O ÷ C)

where A = annual demand (units), O = ordering cost per order, C = carrying cost per unit per year.

Question: Annual demand is 8,000 units. Ordering cost is ₹200 per order. Purchase price is ₹40 per unit and carrying cost is 10% of the purchase price per year.

Solution:

• C = 10% of ₹40 = ₹4 per unit per year
• EOQ = √(2 × 8,000 × 200 ÷ 4) = √8,00,000 ≈ 894 units
• Number of orders per year ≈ 8,000 ÷ 894 ≈ 9 orders

At EOQ, annual ordering cost and annual carrying cost are approximately equal — a useful check.

4. Numerical 3 — Stock Levels

Question: Normal usage 100 units/week; minimum usage 60; maximum usage 140. Re-order period 4–8 weeks (normal 6). Re-order quantity 1,000 units.

Solution:

• Re-order level = 140 × 8 = 1,120 units
• Minimum level = 1,120 − (100 × 6) = 520 units
• Maximum level = 1,120 + 1,000 − (60 × 4) = 1,880 units
• Average level = (520 + 1,880) ÷ 2 = 1,200 units

5. Numerical 4 — Labour Cost: Halsey and Rowan Plans

Incentive plans reward workers for saving time.

• Halsey Plan bonus = 50% × Time saved × Rate per hour
• Rowan Plan bonus = (Time saved ÷ Time allowed) × Time taken × Rate per hour

Question: Time allowed 10 hours; time taken 8 hours; rate ₹50 per hour.

Solution:

• Basic wages = 8 × ₹50 = ₹400; Time saved = 2 hours
• Halsey bonus = 50% × 2 × ₹50 = ₹50 → Total earnings = ₹450
• Rowan bonus = (2 ÷ 10) × 8 × ₹50 = ₹80 → Total earnings = ₹480

6. Numerical 5 — Labour Turnover

Question: Workers at the start of the year 900; at the end 1,100. During the year 40 workers left and 30 were discharged. 120 were recruited, of which 50 were for replacements.

Average workers = (900 + 1,100) ÷ 2 = 1,000

• Separation method = (40 + 30) ÷ 1,000 × 100 = 7%
• Replacement method = 50 ÷ 1,000 × 100 = 5%
• Flux method = (70 + 50) ÷ 1,000 × 100 = 12%

(Some textbooks use total accessions in the flux method; follow your prescribed book.)

7. Numerical 6 — Machine Hour Rate

Question: A machine costs ₹2,00,000 with a scrap value of ₹20,000 and a life of 10 years. It runs 2,000 hours a year. Power is ₹10 per hour, repairs ₹6,000 per year and the machine’s share of rent ₹4,000 per year.

8. Presentation Tips for Exams

• Always write the formula before substituting numbers.
• Use a proper table format for cost sheets.
• Show working notes separately for overheads and material consumed.
• State assumptions clearly (for example, 52 weeks in a year).
• Round off only at the final step.

9. Practice Questions

1. Annual demand 12,000 units, ordering cost ₹150, carrying cost ₹3 per unit. Find EOQ. (Answer: 1,095 units approx.)
2. Time allowed 12 hours, taken 9 hours, rate ₹40. Calculate earnings under Halsey and Rowan. (Answer: ₹420 and ₹450)
3. Prepare a cost sheet with prime cost ₹1,50,000, factory overheads 40% of prime cost, office overheads 10% of works cost and profit 20% on cost of sales (no selling overheads).

Strengthen your basics with the CU B.Com Sem 1 Financial Accounting Notes and practise objective questions in Accounting MCQ Questions with Answers.

Frequently Asked Questions

What is the difference between cost accounting and financial accounting?

Financial accounting reports the results of the whole business to outsiders. Cost accounting focuses on the cost of products, processes and activities to help management control costs and set prices.

Is the cost sheet asked every year?

Cost sheet questions are common in many university papers, but patterns vary. Use previous papers of your own university to judge frequency.

How do I remember stock level formulas?

Start with the re-order level (maximum × maximum). Minimum and maximum levels are both built from it.

Where can I practise numericals online?

Use Skillshort’s free Commerce & Accounting Calculators to check answers and the B.Com Study Hub for more resources.

Final Thoughts

Cost accounting rewards practice. Solve one cost sheet, one EOQ and one labour problem every day for two weeks, and the subject will feel far more manageable in the exam hall.