BÀI GIẢNG MÔN HỌC

Giảng viên
 CHAPTER 6- RECORDING BUSINESS
TRANSACTIONS IN MANUFACTURER

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I. Accounting for main costs of manufacturing
1. Accounting for raw materials, supplies.
2. Accounting for tangible assets.
3. Accounting for salary and salary deductions.

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1. Accounting for raw materials

1.1 Raw materials: directly participate in the production process

to made products. The value of raw materials shall transfer into
the product cost.

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1.2.Calculating costs of materials
•

Directly Trade discount

irrecoverable attributable and

Raw = Purchase + taxes + cost - Purchase

materials cost allowance
costs

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1.3. THE METHOD OF CALCULATING COSTS OF
MATERIALS

FIRST IN, FIRST

OUT
(FIFO)
SPECIFIC IDENTIFICATION

WEIGHTED AVERAGE COSTS

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1.4 ACCOUNT
152

Costs of raw materials

received Costs of raw materials
issued

Balance: costs of ending

raw materials

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 Accounting for raw materials received

• Purchasing raw materials:

• Dr 152 : “Raw materials”

• Dr 133 : “Deductible VAT”
• Cr :111, 112, 331… ( total payment)

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Accounting for raw materials issued
• Issuing raw materials for business:

• Dr 621 :“Direct raw materials costs”

• Dr 627 : “Production overheads ”
• Dr 641 : “Selling expenses”
• Dr 642 : “General and administrative expenses”
• Cr TK 152 – “Raw materials”

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2. Accounting for fixed assets
2.1 Concepts for fixed assets
• Concept:
Fixed assets are assets held by
the enterprise to use for
operation. These assets must
satisfy all of criteria of fixed
asset.
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Assets must satisfy simultaneously all
the following four recognition criteria:
1) Future economic benefits will
surely be obtained.
2) Their historical cost has been
determined in a reliable way.
3) Their useful life is estimated at
more than one year.
4) They satisfy all value criteria
according to current regulations.
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2.2 Classification of fixed assets

Tangible assets Intangible assets

(Assets in physical form) (Assets lack physical form)

Example: building and Example : right-of-use

structures, machinery, land , copyright, patent,
equipment, vehicles,… trademarks and brand
name,…

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2.3 Calculating costs of fixed assets
Directly Trade discount
irrecoverable attributable and

Fixed assets = Purchase + taxes + cost - Purchase

costs cost allowance

Carrying cost of accumulated

amount = Fixed assets - depreciation

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 2.4 Accounts

• Ac 211 “tangible assets”

• Ac 213 “intangible assets”
• Ac 214 “accumulated
depreciation”

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2.5 Accounting for increase fixed assets
Fixed assets acquired:
Dr 211 “tangible assets ”, Dr 213 “intangible assets”
Dr 133 : “Deductible VAT”
Cr :111, 112, 331, 341… ( total payment)

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 2.6 ACCOUNTING FOR DEPRECIATION

• Periodically, calculating and recording depreciation of fixed assets:

Dr 627 : “Production overheads ”

Dr 641 : “Selling expenses”
Dr 642 : “General and administration expenses”

Cr 214 : “ Accumulated depreciation”

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 2.7 Accounting for decreasing fixed assets
• Disposal of Fixed assets:
Decreasing carrying amounts of fixed assets:
Dr 811 : “ Other expenses” (carrying amounts)
Dr 214: “ Accumulated depreciation”
Cr 211 “ Tangible assets”
Other expenses of disposal of fixed assets:
Dr 811 : Other expenses
Dr 133 : Deductible VAT (if any)
Cr 111, 112, 331.
Other income on disposal of fixed assets:
Dr 111,112,131
Cr 711 - Other income.
Cr 3331 – VAT payables (if any)
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 3. Accounting for payables to employee
( salary, trade union fees, social
insurance, unemployment insurance)

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3.1 Accounting for employee’s salary
• Concept: Payable to employee is the total amount of money that employee
are paid to do their job.
334
Salaries and wages
Salaries and wages paid payable

Salary deductions

Balance

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(1) Salaries and wages payable to employees:
Dr 622 :“Direct labor costs”
Dr 627 : “Production overheads ”
Dr 641 : “Selling expenses”
Dr 642 : “General and administration”
Cr 334 : Payables to employees
(2) Paid to salaries and wages payable:
Dr 334 – Payables to employees (3341, 3348).
Cr 111, 112

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 From
Salary deductions employee From employer Total

Trade union fees / 2% 2%

Social insurance 8% 17,5% 25,5%

Health insurance 1,5% 3% 4,5%

Unemployment insurance 1% 1% 2%

Total 10,5% 23,5% 34%

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 3.2 Accounting for salary deductions

338
Salary deductions paid and Determination of Salary
submitted deductions

Balance: Social insurance, health

insurance, trade union fees,
unemployment insurance which
have not been paid and submitted

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 3.2 Accounting for salary deductions

(1) Recording entries of salary deductions:

Dr 622,627, 641, 642 : (amounts included in operating expenses)

Dr 334 : Payables to employees
(amounts deducted from salaries of employees)
Cr 338 : Other payables (3382, 3383, 3384, 3386)
(2) Salary deductions paid and submitted :

Dr 338 – Other payables (3382, 3383, 3384, 3386).

Cr 111, 112

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 II. Accounting for production costs and
calculating cost of finished goods

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Production cost

– Direct raw materials costs

– Direct labor costs
– Production overheads.

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 Accounting for direct raw materials costs
(1) Raw materials used for manufacturing:
Dr 621 : Direct materials costs
Cr 152 : Raw materials
(2)At end of account period, accountants record:
Dr 154 : work in process
Dr 621 : Direct materials costs

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 Accounting for direct labor cost
• (1) Manufacturing payroll:
Dr 622 - Direct labor cost
Cr 334 - Wages payable
(2) Salary deductions:
Dr 622 - Direct labor cost.
Cr 338 - Other payables (3382, 3383, 3384, 3386)
(3) At the end of accounting period, accountants record:
Dr 154 - work in process
• Cr 622 - Direct labor cost.

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 Accounting for Manufacturing overhead costs

• (1) Manufacturing overhead costs incurred:

Dr 627 : Manufacturing overhead costs
Cr 152, 153
Cr 214
Cr 334, 338
Cr 111, 112, 331 …
• (2) At end of account period, accountants record:
Dr 154
Cr 627
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 Accounting for calculating cost of
finished goods
Production
Cost Opening costs Closing
of
finished goods = Work in + Incurred during - Work in process
process the period

Unit cost of = Costs of finished goods

finished goods Units of finished goods

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Accounting for sales

Concept
– Consuming finished goods is an activity that a enterprise to sell goods to
customers and they have paid or accepted to pay

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 Accounting for sales
1) Record sales revenue:
Dr 111, 112, 131, ... (total payment)
Cr 511 : selling price (net of VAT)
Cr 3331 : VAT payable to State
2) Concurrently, record cost of goods sold:
Dr 632 : Cost of goods sold
Cr 154,155, 156

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Accounting for selling expenses, general
&administration expenses
• Selling expenses incurred:
Dr 641 ( Dr 133- if any)
Cr 334 ,338
Cr 152, 153, ….
Cr 214
Cr 111,112,141,331…

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Accounting for selling expenses, general
&administrative expenses
(1) General & administrative expenses incurred:
Dr 642 ( Dr 133- if any)
Cr 334 ,338
Cr 152, 153, ….
Cr 214
Cr 111,112,331…

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 Accounting for calculating income summary

Transferring revenues, financial income and other income to 911

Dr 511
Dr 515
Dr 711
Cr 911

Transfering all of costs, expenses to Dr 911

Dr 911 -
Cr 632
Cr 641
Cr 642
Cr 635
Cr 811

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 Accounting for calculating income summary

• Transferring profits:
Dr 911 - Income Summary
Cr 421 – retained earnings
Transferring losses:
Dr 421 – retained earnings
Cr 911 - Income Summary

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