Accounting for overheads

Meaning : It is the aggregate of indirect material,indirect labour and indirect expenses which cannot be identified with particular job, product or cost centre. Classification of overheads By function Production overheads Administration overheads Selling overheads Distribution overheads By behavour Fixed overheads Variable overheads Semi variable overheads By element Indirect labour Indirect material Indirect expenses Classification […]

Accounting for labour cost

Accounting for labour cost Labour is a essential factor used in the process of production arise from human resources. It can be classified in two parts Direct and indirect Tailor, carpenter etc it is a part of prime cost Indirect labour Such cost can not be identified with per units of production Time keeping department […]

income under head salary

income under head salary Free domestic servant provided by employer :   Watchman, sweeper or Gardner provided by employer – cost incurred by employer will be vlue of perquisite. Gas, electricity and water supply provided by employer owned by employer- manufacturing cost purchase by employer -market price or purcahse cost Note :  If unfurnished or […]

bonus and right shares

Bonus shares: Shares issued by company free off, it means without consideration to existing shareholders. It is a capitalization of free reserves. Free reserve means not for specific purpose, profit available for dividend, like profit and loss account, general reserve etc. it excludes unrealized gain like revaluation reserves. There are two types of bonus shares: […]