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Difference between manufacturing sales and trading sales?

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Querist : Anonymous

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Querist : Anonymous (Querist)
29 July 2015 I need the difference between manufacturing sales and trading sales for preparation of projected statements of a rice mill.please inform me the difference as early as possible.
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Vishrut Shah

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Vishrut Shah (Expert)
29 July 2015 The difference will be as following :

(1) Stock -

In case of trading there will be only closing stock in case of manufacturing sales there will be stock of raw material and WIP over and above finished goods

(2) Direct Expenses -

In case of trading there will be only routine direct expenses like freight etc. in case of manufacturing sales there will be conversion expenses over and above routine expenses

(3) Working Capital -
It will have direct impact in operating cycle and working capital requirements
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