Manufacturing, Trading, and Profit & Loss Account

A manufacturing account is prepared in addition to the trading and profit and loss account. It is produced for internal use only. The manufacturing account is used to calculate and show the cost of manufacturing goods. This model consists of two pages, the manufacturing, Trading and Profit and Loss Account Verification, and the second page which is the balance sheet.

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A manufacturing account is prepared in addition to the trading and profit and loss account. It is produced for internal use only. The manufacturing account is used to calculate and show the cost of manufacturing goods.

TYPES OF COSTS
1) Prime Cost
– Direct materials
– Direct labour
– Direct expenses
2) Production Costs
– Indirect manufacturing cost
Manufacturing costs are sometimes called “Overhead expenses”
3) Direct Costs
4) Administrative Expenses
5) Selling & Distribution
6) Financial Charges

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