MATERIAL CONSUMED

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This query is : Resolved

Gopi Venkatesh (Querist)

20 September 2019 SIR ,

WE ARE REGISTERED AS WORKS CONTRACTORS. WHEN WE ARE USING THE MATERIALS PURCHASED IN THE PROJECT, WHAT ENTRY SHOULD BE PASSED. (SINCE THE STOCK IS DECREASING).

PLEASE CLARIFY DETAILLY.

A.S.SUNDARARAJAN

A.S.SUNDARARAJAN

(Expert)

21 September 2019 There are three types of stock 1. Raw material 2. Semi finished goods 3. Finished goods. From your mail we understand that inputs / raw material is issued for doing the project and project is yet to be completed.
If so, debit material consumption and credit raw material account. Then Debit semi finished goods and credit raw material consumption. If you have software for manufacturing accounting , the system will automatically do accounting in operations and also in finance

Gopi Venkatesh

Gopi Venkatesh (Querist)

21 September 2019 sir the material we purchased will be in closing stock, but when we are using the stock for the project, what entry should be recorded and under which group in tally.

A.S.SUNDARARAJAN

A.S.SUNDARARAJAN

(Expert)

23 September 2019 In Tally, create new ledgers semi finished goods and finished goods in current assets category like that of raw materials. similarly create ledgers like raw material consumed, semi finished goods consumed and finished goods consumed under direct expenses group and pass entry as per above mail.

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