Why should a company set up a manufacturing expense account? Is it mandatory for all businesses to s

Manufacturing costs. Accounts are used to account for overheads that cannot be directly attributed to the production cost of a product.

Target. This account is used to collect all the indirect costs that should be allocated, and then allocate them to each product according to the allocation method selected by the enterprise, and form the final cost of each product together with the direct cost.

The accounting of manufacturing expenses is actually a part of the cost management of the enterprise, if the enterprise chooses a simpler and more direct cost accounting method, for example, the enterprise only has one product, so all overhead expenses are classified into the cost of this product, there is no need to set up this account. However, in reality, most companies still need to set up this account.

The Manufacturing Expense account is a cost account.

1. The manufacturing expenses belong to the cost account, the debit side registers and collects the manufacturing expenses incurred, and the credit side reflects the distribution of the manufacturing expenses, and there is no balance at the end of the month.

2. Manufacturing costs refer to the indirect costs incurred by the enterprise for the production of products and the provision of labor services, including water and electricity costs, depreciation of fixed assets, amortization of intangible assets, employee remuneration of management personnel, labor protection expenses, grinding or environmental protection expenses stipulated by the state, and downtime losses during seasonal and repair periods.

3. The specific content of manufacturing costs can be divided into:

1. Indirect expenses for product production, such as machine material consumption costs, depreciation costs, repair costs, insurance premiums of fixed assets used in workshop production, lighting costs and labor protection costs for workshop production, etc.

2. Some expenses that are directly used in product production, but are not required or convenient for separate accounting in management, and therefore do not set up cost items separately for accounting, such as amortization of production tools, design and drawing costs, test costs and power costs for production processes.

3. The expenses used by the workshop to organize and manage production, such as the wages and welfare expenses of the management personnel of the workshop, the depreciation and repair costs of fixed assets for workshop management, the amortization expenses of workshop management tools, the water and electricity costs, office expenses, travel expenses, etc. for workshop management.

That is, the account will not appear on the accounting entry at the same time as the manufacturing expense.

For example, if the debit is a manufacturing expense, the credit cannot be an expense account, or if the credit is a manufacturing expense, the debit cannot be an expense account, and the expense account is an account that does not correspond to the manufacturing expense.

Accounts that can correspond to manufacturing costs include:

1. Raw materials;

2. Production cost;

3. Remuneration payable to employees.

Inventory items do not correspond to manufacturing expenses.

That is, the account will not appear on the accounting entry at the same time as the manufacturing expense. For example, if the debit side is a manufacturing expense, the credit side cannot be an expense account, or a credit method to create or peg expenses, and the debit side cannot be an expense account, and the expense account is an account that does not correspond to the manufacturing expense. Accounts that can correspond to manufacturing costs include:

1. Raw materials; 2. Production cost; 3. Remuneration payable to employees.

What kind of books should be set up for the "Manufacturing Expenses" account? Is there a balance at the end of the period? What should I do?

Seeing that there is no one asked, now remove the screenshot and re-code the words below:

First, the "manufacturing expenses" account should be set up with a three-column account book, and should be accounted for in detail according to different production workshops, departments and expense items.

Clause. 2. Except for seasonal small production enterprises, there should be no balance at the end of the period of the 'manufacturing expenses' account.

Clause. 3. Accounting treatment in this way:

1) When the rights and responsibilities occur: once the production workshop incurs the cost of machine material consumption and fixed asset repair, the wages of the production workshop management personnel and other employee salaries, the depreciation of fixed assets accrued in the production workshop, the office expenses, water and electricity bills paid by the production workshop, the seasonal and repair period of shutdown losses, and the occurrence of the loan interest before the completion of the manufacture of the product that can reach the predetermined saleable state after more than one year of manufacturing, then, the 'manufacturing expenses' are debited and the 'raw materials' are credited. Bank Deposits', 'Employee Remuneration Payable', 'Accumulated Depreciation', 'Interest Payable'.

2) At the end of the period, the distribution of manufacturing expenses is included in the relevant cost accounting objects, and the accounts such as 'production costs - basic production costs, auxiliary production costs' are debited, and the 'manufacturing expenses' accounts are credited. In particular, for the difference between the actual amount of manufacturing expenses incurred and the allocated amount of small enterprises in seasonal production, except for the difference between the actual amount incurred and the allocation amount of the remaining part of which can be reserved for distribution in the next year for the preparation of production in the next year, the difference between the actual amount incurred and the allocation amount shall be debited to the account of 'production cost - basic production cost' and credited to the account of 'manufacturing expenses';If the actual amount is less than the difference between the allocated amount, the opposite accounting entry shall be made.

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Hello classmates, I'm glad to answer for you!

"Manufacturing expenses" account: It is used to collect and distribute the indirect production expenses incurred by the production workshop of the enterprise for the production of products.

Gordon wishes you a happy life!