4.2 The accounting aspects of back-flush accounting § Back-flush accounting offers an abbreviated and simplified approach to costing by getting rid of ‘unnecessary’ costing records.
§ In the examination you will not be required to perform the double entry for back-flush accounting.
A traditional system
§ A traditional costing system will include the following Τ accounts:
§ The figures for closing inventory in materials, WIP and finished goods are the remaining balances carried forwards after other entries have been made.
§ For example, in the WIP account the value of closing WIP is the balancing figure after the cost of finished goods has been transferred out to the finished goods account.
§ The figures are built up from expenses being incurred through to cost of goods sold.
§ Variances can be calculated at each stage (e.g. materials price, materials usage, etc.)
§ Where process production is involved, these T-accounts will be repeated for each process with the output of one process being the input for the next. |
发表于 2012-2-23 17:09:42
