The following figures have been extracted from the cost records of a manufacturing unit: (₹) Stores: Opening balance 32,000 Purchases of material…

(a) Costing books Stores Control Account Particulars (₹) Particulars (₹) To Balance b/d 32,000 By W.I.P. Control A/c 1,60,000 To General ledger adjustment A/c 1,58,000 By Work overhead control A/c 20,000 To Work in progress control A/c 80,000 By Costing Profit and Loss A/c 6,000 By Balance c/d 84,000 2,70,000 2,70,000 W.I.P. Control Account Particulars (₹) Particulars (₹) To Balance b/d 60,000 By Stores control A/c 80,000 To Stores control A/c 1,60,000 By Costing profit and loss A/c (Cost of sales) 4,00,000 To Direct wages control A/c 65,000 To Works overhead control A/c 2,40,000 By Balance c/d 45,000 5,25,000 5,25,000 Works Overhead Control Account Particulars (₹) Particulars (₹) To General ledger adjustment A/c 2,50,000 By W.I.P. Control A/c 2,40,000 To Store ledger control A/c 20,000 By Costing profit & loss A/c (under recovery) 30,000 2,70,000 2,70,000 Costing Profit & Loss Account Particulars (₹) Particulars (₹) To W.I.P. control A/c (Cost of sales) 4,00,000 By General ledger adjustment A/c 4,00,000 To Works overhead control A/c 30,000 Cost of sales 4,00,000 To Stores control A/c (shortage) 6,000 10% profit 40,000 To Profit 4,000 4,40,000 4,40,000 4,40,000 (B) Financial Books Profit & Loss Account Particulars (₹) Particulars (₹) To Opening stock By Sales 4,40,000 Stores 32,000 By Closing stock: W.I.P. 60,000 92,000 Stores 84,000 W.I.P. 45,000 To Purchases 1,58,000 By Income from investment 10,000 To Wages incurred 70,000 By Loss 11,000 To Overheads incurred 2,50,000 To Loss on sale of capital assets 20,000 5,90,000 5,90,000 Reconciliation statement (₹) (₹) Profit as per Cost Accounts 4,000 Add: Income from investment recorded in Financial accounts 10,000 14,000 Less: Under absorption of wages in Cost accounts 5,000 Loss on sales of capital asset only included in Financial accounts 20,000 25,000 Loss as per Financial accounts 11,000