manufacturing account

Definition:

a financial statement analysing the cost of goods manufactured over a period. It usually gives direct expenses, direct labour cost, direct material cost and production overhead cost to arrive at production cost of sales which will form all or part of cost of sales in the trading and profit and loss account. (Production cost of sales will be only part of cost of sales if the enterprise also purchased goods for resale). This information may be included in the trading and profit and loss account which may then be called a ‘manufacturing, trading and profit and loss account’. In America, called ‘cost of goods manufactured statement’, ‘manufacturing statement’.



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