Railway Accounts Department Examinations

Wednesday, May 3, 2023

Costs - Statistics



Consists of 


Packing, Charges for loading goods into trucks, Transport from consignor’s godown to the Railway Station, Unloading and loading of the Consignment into the Wagon


Delivery of consignment at the Destination station i.e., Cost of unloading from Wagon and loading in Truck and cost of transport from the destination station to consignee’s godown


Also called Inventory Costs 

Interest charges on the capital value of Goods locked up during the period of Transport. 

Formulae: Inventory Cost per Tonne = V x R x T / 365

V -  Value of Tonne of Goods  

R - Annual Rate of Interest 

T - No of days in transit from Consignor’s Godown to the Consignee


Hence delay in transit puts the Consignee at a loss because inventory costs will go up. 

If Railway transit takes longer time, traders would prefer Road Transport which takes much less time, even though Railway Freight may be lower.  


Consignor Cost + Consignee Cost + Inventory Cost + Freight 

Trader’s Cost is useful for comparing Railway freight with the Road Transport freight.  

Trader’s cost - Goes into the price of Commodity in the Market


Acquisition, Maintenance, Operation, Improvement, Replacement of transport facilities, compensation for damages, interest on borrowed money, Dividend on Capital etc.  


Cost of transport to the Nation in terms of national resources of labour and material 

Its calculation is required for resource allocation on different means of transport.  

Also, take into account the cost of movement of goods by other means of transport also 

Excludes: Element of all taxes and duties of Central and State Governments

Key Points for MCQ 

  1. Imputed costs also called Inventory Cost 


  1. Formulae of Imputed / Inventory Cost per Tonne  = V x R x T / 365  


  1. V - Value of Tonne of Goods 


  1. R - Annual Interest Rate 


  1. T - No of days in transit from Consignor’s Godown to Consignee 


  1. Trader’s cost = Consignor Cost + Consignee Cost + Inventory/Imputed Cost + Freight  


  1. The trader’s cost goes into the price of the commodity in the Market 


  1. Economic Cost excludes Taxes and Duties paid by the Central Govt. and State Govts. 


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