How to account for auxiliary production costs

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In this article, I will not rewrite the regulations (but will only list them below) that regulate the accounting of materials at a manufacturing enterprise. This is quite enough on the Internet. Here I will talk about practical accounting of materials in production.

Accounting for materials in production is regulated by:

— PBU 5/01 “Accounting for inventories” (Order of the Ministry of Finance dated 06/09/2011 No. 44n); — Methodological guidelines for accounting of inventories (Order of the Ministry of Finance dated December 28, 2001 No. 119n); — Methodological guidelines for accounting of special tools, special devices, special equipment and special clothing (Order of the Ministry of Finance dated December 26, 2002 No. 135n).

As I explain at seminars, learn to read and apply the law, and you will be happy.

But in fact, accounting for materials in the production of products is a fairly voluminous area of ​​work. Moreover, if your company produces finished products for a wide range of consumers. Consequently, the success of the company’s development and its further existence depends on the correct management of this area. Let's look at the stages of movement and accounting of raw materials and materials in production.

MATERIALS MANAGEMENT

If we delve a little deeper into financial accounting, we will understand where the materials for production come from. Firstly, a sales plan for finished products is drawn up, and from there the following are drawn up:

• production plan;
• procurement plan for this production of materials;
• labor cost plans;
• and other company plans and budgets.

That is, the plan for the purchase of raw materials and supplies is taken based on the production plan! Next, the company's suppliers select suitable suppliers according to their parameters and order raw materials for the production of products.

Main types of costs in auxiliary production

The expenses of auxiliary production are accumulated on account 23 of the same name in accordance with the order of the Ministry of Finance of Russia dated October 31, 2000 No. 94n.

The debit of this account reflects the following composition of auxiliary production costs:

• direct costs for production of products, performance of work and provision of services;
• indirect costs associated with the management and maintenance of auxiliary production, as well as losses from defects.

RECEIPT OF MATERIALS

Materials arrive at the warehouse. An organization may have several warehouses. This may be one common warehouse, or it may be a division of warehouses into production workshops. Depending on the number of warehouses, responsible material persons for the receipt and release of materials must be identified and documented. This will be useful to the accountant at the end of the month to calculate the actual cost, based on the results of the inventory.

So, the materials have arrived at the warehouse, the MOL (materially responsible person) accepts this material into the warehouse and signs the receipt on the delivery note. One copy of the invoice is returned to the supplier, and the other to the accounting department. This is the arrival of raw materials to the warehouse. There may be several receipts within a month. Accordingly, these receipts are reflected in the accounting and storekeeper records.

Accounting for materials in production - accounting entries:

1) Dt 10 Kt 60 – receipt of materials from the supplier.

2) If you work with VAT, then separate out from the amount of VAT receipts: Dt 19 Kt 60 – VAT on materials is reflected

3) And if the supplier gave you an invoice that you can accept for deduction, then you accept this VAT for deduction: Dt 68.2 Kt 19 – we accept VAT for deduction.

Example A supplier shipped us materials worth 120,000 rubles, including 20% ​​VAT. Based on the invoice, the accountant makes the following entries: Dt 10 Kt 60 – 100,000 rubles (we take into account the material without VAT); Dt 19 Kt 60 – 20,000 rubles (we reflect VAT on receipt); Dt 68.2 Kt 19 – 20,000 rubles (we accept VAT for deduction based on the invoice).

Task for independent solution:

Prepare accounting entries.

The supplier shipped material in the amount of 162,000 rubles, including 20% ​​VAT.

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Ancillary production usually refers to the part of an enterprise’s activities necessary to maintain and ensure the uninterrupted operation of the main production. Auxiliary production may include: transport facilities, repair shops, packaging shops, workshops for the production of tools, dies, spare parts, etc.

Accounting

In accordance with the current Chart of Accounts and instructions for its use (approved by order of the Ministry of Finance of the Russian Federation dated October 31, 2000 No. 94n), accounting for auxiliary production is carried out on account 23 “Auxiliary production”. This account is intended to summarize information about the costs of production that are auxiliary (auxiliary) for the main production of the organization.

The debit of account 23 reflects direct expenses directly related to the production of products, performance of work, provision of services and indirect expenses associated with the management and maintenance of auxiliary production, as well as losses from defects.

The credit of account 23 reflects the amounts of the actual cost of products produced, work performed, services rendered in correspondence with the accounts:

• 20 “Main production” - when releasing products (works, services) to the main production;
• 25 “General production expenses” - when releasing products (works, services) to general production units;
• 26 “General business expenses” – when selling products (works, services) to administrative departments.

The balance of account 23 at the end of the month shows the cost of work in progress.

Analytical accounting for account 23 is carried out by type of production.

In accounting, the costs of auxiliary production are included in the cost of goods, works and services sold as expenses for ordinary activities.

Tax accounting

In tax accounting, the costs of auxiliary production are divided into direct and indirect. Direct costs are included in the cost of finished products, and indirect costs are written off in the current period. In this case, the taxpayer independently determines the list of direct costs associated with the production of products (performance of work, provision of services).

In the 1C:Accounting 8 program, the write-off of auxiliary production expenses is reflected in the document “Production Report for the Shift”. Accounting for auxiliary production can be carried out at actual or planned cost.

To perform operations, check the settings of the accounting parameters and accounting policies of the organization:

Accounting parameters.

Menu: Administration – Accounting parameters – hyperlink “Setting up a chart of accounts”.

In the “Cost Accounting” section, a hyperlink “For each division” should be displayed.

Accounting policies for accounting.

Select the “Perform work, provide services to customers” checkbox. When this checkbox is selected, the “Costs are written off” field becomes visible and active. In the “Costs are written off” field, select “Excluding revenue”.

In the debit of account 23 we write off the costs of performing services for our own production (materials, wages, payroll deductions, depreciation, etc.) using the relevant documents and regulatory operations.

To reflect the services of auxiliary production, we will use the Document “Production Report for a Shift”:

• In the “from” field, indicate the date of the service.
• In the “Cost account” field, indicate the account from which (at the end of the month) the costs of the auxiliary workshop will be written off.
• In the “Cost division” field, select the production division of the organization that performs the work.
• The "Warehouse" field is not filled in.
• In the “Nomenclature” field, select the name of the work (services) performed.
• In the “Quantity” field, indicate the number of works performed (services provided).
• In the “Planned price” field, the planned price is not indicated, because accounting is carried out at the actual cost, which will be determined at the end of the month by the regulatory operation “Closing accounts 20, 23, 25, 26” through the “Closing the month” processing.
• The “Planned amount” field will remain blank.
• In the Cost Account field, enter the cost account and department.
• Click the “Pass” button.
• To call the printed form “Services for own departments”, use the “Print” button.

When carrying out the routine operation “Closing the month”, the actual expenses of auxiliary production will be written off to the cost account specified when generating the document “Production report for the shift”.

Based on materials from www.its.1c.ru

RELEASE OF MATERIALS FOR PRODUCTION

Through the receipt/receipt of material, we have formed current assets in the warehouse. And these assets should be used in the production of products, and not lie idle and overstock our warehouse with dead weight. In order to release material from the warehouse into production, it is necessary for the person in charge at production (and perhaps in each workshop) to make a request to the storekeeper to release the material into production. This application must indicate the quantity of material required. If a given amount of raw materials and supplies is available, then the storekeeper releases this asset to the foreman (the responsibility for receiving material into production can be assigned to any person in the production workshop, but as a rule, this is the workshop foreman).

Here is a sample Request for release of material into production.

The storekeeper accumulates data from applications for the release of material into production within a month. Then it is transferred to the accounting department. Each company sets the frequency of transfer of these applications independently, depending on the production process.

And thus, during the month, the accounting department reflects: - documents of receipt of material at the warehouse (based on invoices); — documents for release of material into production (based on requests from foremen). And this is enough to carry out an inventory of the main warehouse. Where the credentials will appear:

• balance at the beginning of the month
• plus arrival within a month
• minus monthly consumption
• and what should be left at the end of the month.

These are credentials. But the actual data will be determined by conducting an inventory.

Accounting entries for the release of material into production:

Dt 20 kt 10 – release of material into production.

What applies to auxiliary production

Ancillary manufacturing facilities are subsidiary units to the main product production lines. The tasks of support departments may include:

• supply of energy resources;
• transport maintenance;
• repair and modernization of fixed assets;
• creation of tools, parts, fasteners, preparation of spare parts;
• erection of temporary structures;
• extraction of construction raw materials and materials;
• logging work;
• processing of agricultural products.

Question: How to record the acquisition of production equipment that requires installation and its installation by auxiliary production? Equipment requiring installation (machine) was purchased under a sales contract at a price of RUB 960,000. (including VAT RUB 160,000). The cost of installing equipment is 50,000 rubles. The equipment is intended for use in production for a period exceeding 12 months. Depreciation on equipment is not considered in this consultation. View answer

Auxiliary production is needed to ensure uninterrupted production of products and at the same time minimize costs for additional services in favor of third parties. They are formed in the form of separate workshops, departments and structural divisions, and can be represented by laboratory centers, counting stations and computing complexes.

NOTE! Auxiliary production does not include enterprise services that are part of departments or structural units (design units, chief engineer or chief power engineer).

The characteristic features of an auxiliary production unit are:

• lack of manufacturing capabilities for core product lines;
• focus on servicing the main workshops and the availability of facilities with equipment for the production of semi-finished products;
• the results of work in auxiliary departments when transferring manufactured semi-finished products to the main technological department are reflected in the calculation of the cost of goods.

Question: How to reflect in the accounting of the lessee organization the costs of routine repairs of a vehicle received under a bareboat rental agreement, carried out by the organization’s auxiliary production? The cost of current car repairs amounted to 40,000 rubles. (including materials, employee wages, insurance premiums). In the month of completion of repair work, materials used cost 24,000 rubles. paid in full, and salaries and insurance premiums are paid next month. The car is used in the main production of the organization. The organization did not create a reserve for the repair of fixed assets (FPE) for profit tax purposes. The organization prepares interim financial statements on the last day of each calendar month. View answer

Auxiliary production is divided into the following types:

• Mechanical repair workshops.
• Transport departments.
• Energy economy.
• Refrigeration equipment service departments.
• Construction of temporary structures on construction sites.
• Warehouse facilities.

BY THE WAY! With a significant increase in the share of products they produce in relation to other areas of activity, auxiliary production can become the main production divisions.

Repair shops are responsible for diagnosing equipment, repairing it, and performing regular preventive maintenance. Energy structures may include:

• boiler rooms:
• sewer communications;
• water supply system;
• electrical substations;
• transformer installations;
• diesel or gasoline generators;
• gas and electric networks;
• radio networks;
• furnace equipment;
• electrical equipment repair department.

Energy management is required for large volumes of energy consumption. The department is responsible for energy production and its supply to production workshops. Transport departments use several types of vehicles:

• external;
• in-shop;
• intershop;
• warehouse

For continuous transport services, piping systems and conveyor structures can be used.

Warehouse facilities are needed to create stocks of products and semi-finished products and ensure the safety of goods. Warehouse areas can be used for short-term and long-term placement of product groups. According to their purpose, warehouses are closed, open and semi-closed, supply, general plant, workshop, production, and sales. Depending on their functionality, warehouses are classified into universal or specialized categories.

METHODS FOR RECORDING MATERIALS INTO PRODUCTION

When materials are released into production, they can be assessed in three ways:

• at the cost of each unit;
• at average cost;
• using the FIFO method.

Let's talk about each:

At the cost of each unit - this method is used quite rarely, and in certain types of activities. For example, when writing off precious stones in jewelry production. Since it is difficult to evaluate two different diamonds based on their average cost