Friends Please Reply Urgently...
is the "change in inventories of work-in-Progress and finished goods" will be charged in Total Manufacturing Expenses"????
Thank u very much
3 Replies
Shruthi
(Article Assistent)
(336 Points)
Replied 06 December 2013
Your question,"Is expenses incurred to convert WIP into finished goods is manufacturing expenses?" Right?
Answer is YES
Ishika
(ca final)
(250 Points)
Replied 06 December 2013
Well this is not my Question...My question is whether the change in the value of stock i.e. due to escalation cause the market value decreases then is the difference will be charged in manufacturing cost?
CA Dhruva Kalamanji
(Chartered Accountant )
(1996 Points)
Replied 09 December 2013
No you cant charge as manufactring cost instead you can charge to P/L account.
beacuse manufacturing cost refers to all the direct material, direct labour and direct overheads form parts of manufacturing cost. these cost are easily identifiyable with the finised product. where as reduction in market value due to escalation cause is not direct item. and hence it should be charged to P/L
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