Acc 2 manufacturing trading

What is the manufacturing trading account?

Name four parts of a manufacturing trending account

Raw materials

Factory overhead

Less costs of sales

Less other expenses

What do we calculate in Raw materials and how do we calculate them?

1. raw materials available for use. We calculate this by adding opening stock, purchases of room, materials, and carriage inwards the less return outwards

2. Role materials to be consumed. We calculate this by lessing closing stock

3. Then add direct costs to get prime costs

How do we calculate factory overhead and their calculations?

1. Total cost of production is calculated by adding indirect costs depreciations like plants and buildings, indirect expenses that supports factory than add prime cost

2. Factory costs of finished goods is calculated by adding opening stock, then less closing stock

3. Add sales subtract to return inwards to get net sales

Define the calculations in less cost of sales

In less costs of sales, we calculate the gross profit by adding opening stock and factory costs, then less closing stock

Net sales subtracted to less cost of sales is equal to gross profit

name other expenses