Additional Cost features

Additional Cost feature

Additional cost of purchase of any item is cost incurred over and above the purchase rate e.g.: - customs duty paid, freight charges, insurance charges, sales tax, octroi etc. Usually the closing stock of the company is shown at cost price, however the above-mentioned expenses are part of the additional cost and the final cost price of any item purchased should include the effect of such expenses and should reflect accordingly. Tally ERPprovides two methods of additional cost allocation

1. Appropriation by value
2. Appropriation by quantity

For example: -

Purchase Bill


Items Qty. Rate Value

Item 1 10 20 200
Item 2 20 40 800


Additional Cost

Insurance 50
Custom duty 20
Octroi 30 100

Total Value 1100

If we use the costing method appropriate by value the effective rate of

Item 1 would be 22
Item 2 would be 44

If we use the costing method appropriate by quantity the effective rate of

Item 1 would be 21
Item 2 would be 43

(* All the figures mentioned above are in Rs. and rounded off)

During the exercise we will learn it in appropriate manner.

F-11 >> Activate Additional Cost >> Yes


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