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Cost Reconciliation Statement | Exam Based Questions and Answers

Published on: April 22, 2021

Exam Based Problems and Answers of Cost Reconciliation

Exam based problems and answers of cost reconciliation statement are the BEST collection for sure shot success in the examination.

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These questions are set according to:

As per financial account

As per cost account

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EXAM BASED PROBLEMS AND ANSWERS OF COST RECONCILIATION

AS PER FINANCIAL ACCOUNT

Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Br = P = Birr = Currency of your country

PROBLEM: 1

The net profit as per financial account was Rs 42,000 of ABC Trading. On reconciliation, the following differences were noticed:

Works overhead over recovered in cost account Rs 6,000

Interest charged in financial accounts Rs 4,000

Opening stock overvalued by financial accounts Rs 10,000

A profit of Rs 5,000 on sales of fixed assets was shown in financial account.

Goodwill written off Rs 7,500

Required: Reconciliation between financial and cost account

[Answer: Rs 52,500;

Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Br = P = Birr = Currency of your country

PROBLEM: 2

The net profit as shown by the financial account of AK Company is Rs 180,000. On the reconciliation, following facts were disclosed:

Works overhead over recovered in cost account by Rs 25,000

Administrative expenses under recovered in cost account by Rs 15,000

Bank interest credited in financial account by Rs 4,500

Depreciation under charged in cost account Rs 2,500

Provision for bad debts made in financial account Rs 3,530.

Required: Reconciliation statement of cost and financial account

[Answer: Rs 171,530]

Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Br = P = Birr = Currency of your country

PROBLEM: 3

The net profit as per financial account of A Trader was Rs 35,000. On reconciliation, the following differences were noticed:

Factory overhead recorded in cost account Rs 60,000 but debited in financial accounts Rs 65,000.

Office and administrative overhead under charged in financial accounting Rs 7,000.

Dividend received recorded in financial accounting Rs 8,000.

Closing stock undervalued in cost accounting by Rs 9,000.

Obsolescence loss recorded in financial account Rs 6,450

Required: Reconciliation statement between financial and cost accounting

[Answer: Rs 22,450]

Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Br = P = Birr = Currency of your country

PROBLEM: 4

On comparison of cost and financial account, the following differences were noticed:

Net profit as per financial account Rs 74,000 of Max Traders.

Over valuation of closing stock in cost account Rs 15,000.

Works overhead over recorded in cost account Rs 5,000.

Administrative overhead over recorded in financial account Rs 10,000.

Dividend received in financial account Rs 6,000.

Bank interest debited in financial account Rs 8,000.

Insurance of warehouse Rs 4,550 recorded in cost account.

Required: Reconciliation statement between financial and cost accounting

[Answer: Rs 91,450]

Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Br = P = Birr = Currency of your country

PROBLEM: 5

Net profit as shown by the financial account of ABC Company Ltd is Rs 150,000. On reconciliation, the following facts were disclosed:

Factory overhead under charged in cost account Rs 20,000.

Office overhead under charged in financial account Rs 15,000.

Depreciation charged on financial account Rs 6,000 and cost account Rs 7,000.

Interest on investment credited in financial account Rs 5,000.

Rent of warehouse Rs 15,000 recorded in cost account

Legal charge debited in financial account Rs 3,270.

Required: Reconciliation statement between financial and cost accounting

[Answer: Rs 137,270]

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AS PER COST ACCOUNT

Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Br = P = Birr = Currency of your country

PROBLEM: 6

The following information is provided by PK Industries:

Net profit as per cost account Rs 100,000.

Work overhead covered in cost account Rs 20,000 but in financial account Rs 25,000.

Administrative overhead over-absorbed in cost account Rs 8,000.

Bank interest credited in financial account Rs 10,000.

Income tax paid Rs 20,000.

Notional depreciation on assets Rs 14,530 fully depreciated in cost account

Required: Reconciliation statement of cost and financial account

[Answer: Rs 107,530]

Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Br = P = Birr = Currency of your country

PROBLEM: 7

The net profit as shown by cost account is Rs 150,000 of RM Rice Mills. On reconciliation of two accounts, the following details were ascertained:

Works overhead under recovered in cost account Rs 15,000.

Bank interest credited in financial account Rs 6,000.

Opening stock in cost account Rs 50,000 but in financial account Rs 40,000.

Provision for doubtful debts in financial account Rs 5,000.

A profit of Rs 10,000 on sale of old machine was dealt in financial account.

Estimating expenses recorded in cost account Rs 7,580

Required: Reconciliation statement between financial and cost account

[Answer: Rs 163,580)

Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Br = P = Birr = Currency of your country

PROBLEM: 8

The net profit as per cost account of SRK Flour Mills is Rs 150,000. On reconciliation, the following differences were noticed:

(a) The factory expenses shown in financial account is Rs 25,000 but recovered in cost account Rs 20,000.

(b) Goodwill written off shown in financial account is Rs 8,000.

(d) Depreciation shown in financial account is Rs 66,000 but charged in cost account is Rs 75,000

(e) Depreciation in stock value of financial account Rs 7,560.

(f) Estimating expenses recorded in cost account Rs 11,230.

Required: Reconciliation statement of cost and financial account

[Answer: Rs 164,670]

Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Br = P = Birr = Currency of your country

PROBLEM: 9

On compression, cost and financial accounts the following facts were disclosed by SK Grill Industries:

Interest on investment received in financial account Rs 3,500.

Work overhead over charged in cost account Rs 5,000.

Administrative overhead over charged in financial account Rs 2,500.

Over valuation of opening stock in financial account Rs 2,000.

Under valuation of closing stock in cost account Rs 3,000.

Excess tax refund recorded in financial account 4,670.

Net profit as per cost account is Rs 44,250.

Required: Reconciliation statement of cost and financial account

[Answer: Rs 55,920]

Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Br = P = Birr = Currency of your country

PROBLEM: 10

The net profit showed by cost account Rs 120,000 of AM Spice Industries. Reconciling the cost and financial accounts, following description were located:

(a) Works overhead recovered in financial account Rs 30,000 but in cost account Rs 25,000.

(b) Depreciation charged in financial account Rs 20,000 but in cost account Rs 24,000.

(d) Interest income credited in financial account Rs 5,000.

(e) Estimation charge paid to engineer Rs 12,000 recorded in cost account

(f) Stores adjustment debited in financial account 4,670

Required: Reconciliation statement of cost and financial accounts

[Answer: Rs 121,330]

Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Br = P = Birr = Currency of your country

PROBLEM: 11

The following differences are notified on reconciling cost and financial account of XYZ Manufacturing Company:

Particulars	Cost Account	Financial Account
Work overhead	57,000	60,000
Administrative overhead	30,000	28,000
Interest received	Nil	9,000
Closing stock	40,000	34,000
Obsolescence loss	Nil	5,470
Notional depreciation	3,520	Nil
Net profit	60,000	?

Required: Reconciliation between cost and financial account

[Answer: Rs 60,050]

Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Br = P = Birr = Currency of your country

PROBLEM: 12

Cost account of AG Manufacturing Concern disclosed the profit of Rs 29,064 for the year just ended while its financial account showed the profit of Rs 20,710 for the same year. On reconciling the figures the following differences are brought to light:

a.	Overhead in cost account were estimated Rs 7,350 while the financial account charged Rs 6,784 for the same period.
b.	Director’s fee charged in financial account Rs 1,050.
c.	A provision for bad debts of Rs 900 has been made in financial account
d.	Income tax of Rs 7,000 was provided in financial account
e.	A transfer fees of Rs 30 received has not been accounted in cost account