Reflection of management costs in accounting Administrative expenses do not depend on the volume of entrepreneurial activity, therefore they cannot be written off to “Main production” at the end of the month (account 20). They are taken into account in the "General expenses" (D 26). Accounting features are the presence of two methods of write-off: Reflection in accounting
- traditional - are recognized as conditionally permanent and are fully related to the full cost, are carried out as K 26, D 90
- based on the division of administrative costs into conditionally fixed and conditionally variable
When using the second method, the reduced cost of production is calculated, semi-fixed costs are written off to the "Cost of sales" (D 90-2), that is, they are recognized as costs of the reporting period that reduce income.
Management expenses: reflection in financial statements
VAT on expenses related to production; Debit 20 Credit 23 - 68,000 rubles. - expenses of auxiliary production associated with the release of finished products are written off; Debit 19 Credit 60 - 90,000 rubles. — “input” VAT was taken into account on the cost of renting premises for general business purposes; Debit 26 Credit 60 - 500,000 rubles. (590,000 - 90,000) - expenses for renting premises for general business purposes are taken into account; Debit 68 Credit 19 - 90,000 rubles. - accepted for deduction of "input" VAT on the cost of renting premises for general economic purposes; Debit 19 Credit 60 - 16,200 rubles. — “input” VAT on marketing and legal services was taken into account; Debit 26 Credit 60 - 90,000 rubles. (106,200 - 16,200) - expenses for marketing and legal services are taken into account; Debit 68 Credit 19 - 16,200 rubles. - accepted for deduction of "input" VAT on marketing and legal services; Debit 26 Credit 69, 70 - 289,800 rubles.
Management expenses. line 2220
Home — Articles In practice, situations are not uncommon when the established accounting procedure ceases to be unambiguous based on the requirements for accounting reporting items established by PBU 4/99. Situation. Conducting an audit of the financial statements of the organization, the auditor indicated to the chief accountant that the article “Administrative expenses” was not formed in the income statement.
The chief accountant referred to the accounting policy approved by the head of the organization, according to which the organization generates an indicator of the total cost of finished products (hereinafter referred to as FP) with an assessment of work in progress (hereinafter referred to as WIP) at actual cost.
Management expenses: composition and reflection in accounting
VAT accrued (42,000 x 20 x18%) 90-3 68-VAT 151,200 Sold products written off (27,300 x 20 ed.) 90-2 43,546,000 OHS written off as expenses of the reporting period 90, subaccount "Administrative expenses" 26,362,000 Recognized financial result (991,200 - 151,200 - 546,000 -362,000) 99 90-9 68,000 Table 5 thousand rubles. Indicator For the reporting year For the previous year Name Code 1 2 3 4 Material costs 120 Labor costs 400 Social contributions 104 Depreciation 38 Other costs 158 Total for cost elements 820 Change in balances (increase (+), decrease (-)): work in progress (56) future expenses reserve for future expenses of finished products (218) The total amount of expenses recorded on account 20 for December amounted to 820,000 rubles.
The release plan is 30 products, in fact - 28 products: 820,000: 30 = 27,300 rubles. (taking into account rounding for convenience of calculations).
Management and commercial expenses
Example A company is engaged in the production of finished goods. The cost of raw materials and materials used in the production process amounted to 2,400,000 rubles.
Attention
Wages of production workers - 900,000 rubles. Compulsory social insurance contributions in the amount of 234,000 rubles were accrued from her.
The cost of paying for the services of third-party organizations related to the production of finished products is 118,000 rubles. (including VAT - 18,000 rubles). The costs of auxiliary production amounted to 68,000 rubles.
The amount of general business expenses is 1,636,000 rubles. (including VAT - 106,200 rubles), of which for: - rent of premises for general economic purposes - 590,000 rubles. (including VAT - 90,000 rubles); — payment for marketing and legal services — 106,200 rubles.
What management costs include: accounting features, write-off methods
Management expenses accounted for on account 26 “General business expenses”, in accordance with the accounting policy, can be monthly (clauses 9, 20 PBU 10/99, Instructions for the application of the Chart of Accounts): 1) written off as conditionally permanent in the debit of the account 90 "Sales", sub-account 90-2 "Cost of sales"; 2) be included in the cost of products, works, services (i.e. debited to accounts 20 “Main production”, 23 “Auxiliary production”, 29 “Service production and farms”). Note! General business expenses of construction organizations may be included in the cost of work under construction contracts only if they are reimbursed by the customer.
14 PBU 2/2008). Features of the inclusion of management expenses in the cost of sales are established by industry methodological instructions, recommendations, guidelines (p.
Management expenses
To write off the conditionally variable part, there are 3 options:
- K 26, D 20 - if they relate to the main production
- K 26, D 23 - if they relate to auxiliary production
- K 26, D 29 - if they relate to a service economy or production
Administrative costs are included in the prime cost after the sale of products (goods) and are written off to “Sales” (account 90). The income statement is reflected in line 040. Some economists express the opinion that administrative costs can be written off to D 91 if there were no sales during the reporting period.
Disputes with the tax office most often arise about spending on the services of management companies. If there is an agreement, a document confirming payment, and an act of acceptance of work performed, there should be no complaints.
What does management costs include?
Important
In individual financial statements, in particular in the profit and loss statement, OCR are reflected under the item “Cost of goods, products, works, services sold” as part of the full cost of goods sold (works, services). In the second method, the expenses accounted for on account 26 "General business expenses" as conditionally fixed are debited monthly to the debit of account 90 "Sales".
Specialists also express the opinion that in the event of a lack of sales in a given period, OCR should be written off to the debit of account 91 “Other income and expenses”. Such an alternative procedure in terms of accounting for OHR is provided for by the interrelated norms of the last paragraph of clause
9 PBU 10/99 and the characteristics of account 26 given in the Instructions for the use of the Chart of Accounts.
As in the case of commercial expenses, the procedure for recognizing and determining the amount of administrative expenses is fully consistent with similar indicators for costs associated with ordinary activities. Read more about this in the section "Cost of sales" (line 2120). As part of management expenses, in particular, they reflect the costs of: - maintenance of the administrative and managerial apparatus; - the maintenance of general economic personnel not related to the production process; - for depreciation and expenses for the repair of fixed assets for management and general business purposes; — rent for premises of general economic purpose; — payment for information, audit, consulting services; — training and retraining of personnel; - purchase of stationery, inventory and other materials necessary for the needs of management.
Which account reflects management expenses?
When evaluating WIP at the actual production cost, accounting will make calculations and reflect the entries presented in Table. 2. The total cost for December will be 1,182,000 rubles.
30 products were to be produced, while 28 were produced in the amount of 1,103,200 rubles. (1,182,000: 30 x 28). So, the cost of the produced GP in December amounted to 1,103,200 rubles, the cost of one product was 39,400 rubles. (1,103,200 rubles: 28 units). The balance of WIP (balance of account 20 as of December 31, 2010) will be 78,800 rubles. (1,182,000 - 1,103,200). We calculate the share of OHR in the total cost per month, for which we take the ratio of OHR to the total cost per month: 362,000 rubles.
: 1 182 000 rub. x 100% = 30.6%. In the cost of a unit of finished products, OCR will be based on the calculated share of OCR 12,056 rubles. (39,400 rubles x 30.6%). In the cost of manufactured products, OCR will amount to 337,568 rubles. (12 056 rub.
Work in progress”, however, the misstatement will be insignificant: 31% (24,432 RUB : 78,800 RUB x 100%). When the WIP valuation method chosen in the accounting policy for the line “Finished products and goods for resale” of the “Inventory” item is reflected, the actual production cost of the remainder of the products that have passed all the stages (phases, redistributions) provided for by the technological process, as well as products completed, tested and technical acceptance. Finished products can be reflected in the balance in one of three estimates, depending on the accounting policy of the organization: at actual production cost; according to the standard (planned) production cost, including the costs associated with the use of fixed assets, raw materials, materials, fuel, energy, labor resources in the production process, and other costs for the production of products; direct cost items.
Indicator For the reporting year For the previous year Name Code 1 2 3 4 Material costs 130(120 + 10) Labor costs 600(400 + 200) Social contributions 162(104 + 58) Depreciation 60(38 + 22) Other costs 230( 158 + 72) Total by cost elements 1182 (820 + 362) Change in balances (increase (+), decrease (-)): work in progress (56) deferred expenses reserve for future expenses of finished products (218) Table “Expenses by ordinary types activities (by cost elements) ”with this method of reflection, it will allow you to receive expenses for ordinary activities in the amount of 908,000 rubles. (1,182,000 - 56,000 - 218,000). Despite the fact that in the example considered (with the first method) R&D is included in the cost of the SOE, the cost of the SOE sold can include the amount of management expenses (in the example, as part of the cost of the SOE, they amounted to 241,000 rubles).
What is included in management costs. what articles are meant?
- Management expenses may include the following:
- other expenses similar in purpose arising in the process of managing the organization and due to its maintenance as a single financial and property complex.
- Management expenses include expenses not related to the production or commercial activities of the enterprise: for the maintenance of the personnel department, the legal department; for lighting and heating of non-industrial buildings, as well as for business trips, communication services and other similar expenses.
In accounting, management expenses are reflected in the debit of the general business expenses account. If, according to the accounting policy, management expenses are partially included in the cost of production, they will be written off to one of the following entries:
Debit 20 Credit 26
- if the production of this type of product is the main activity of the organization.Debit 23 Credit 26
- if auxiliary productions produced products and works and provided services to the side.Debit 29 Credit 26
- if the service industries and farms performed work and services on the side.If such costs are allocated to accounts 20, 23 or 29, they will be included in the cost price as the products are sold, that is, as these costs are written off from accounts 20, 23 and 29 to account 90.
If management expenses are recognized in full, then they will be attributed as conditionally fixed expenses directly to the cost of sales of the reporting period in which they arose. The wiring in this case will be as follows:
Debit 90 Credit 26When administrative expenses are written off to account 90, they are fully included in the cost in the reporting period when they were recognized as expenses for ordinary activities. However, there is one caveat here. This can be done only on condition that the organization complies with the procedure for the formation of expenses on account 26, provided for by the Instructions for the Chart of Accounts, approved by order of the Ministry of Finance dated October 31, 2000 94n. It says that account 26 is provided to reflect information on expenses for management needs that are not directly related to the production process.
It turns out that account 26 was originally intended to account for expenses specifically for managing the organization. However, in practice, it may turn out that this account takes into account not only administrative costs, but also production costs. In this case, it is incorrect to talk about writing off the entire amount from the account of general business expenses by posting Debit 90 Credit 26. You can write off only that part of the costs that are directly managerial.
We also note that when filling out the profit and loss statement, it should be remembered that the Administrative expenses line is filled in only if management expenses are not distributed by calculation objects, that is, the second option for reflecting costs is selected in the accounting policy and there are no Debit 20 entries in accounting Credit 26, Debit 23 Credit 26, Debit 29 Credit 26. Otherwise, management expenses are not deducted from the composition of the production cost and the line Management expenses is not filled in (clause 21 PBU 10/99).
- Management expenses may include the following:
— administrative and management expenses;
- for the maintenance of general economic personnel not related to the production process;
- depreciation and expenses for the repair of fixed assets for management and general business purposes;
- rent for general purpose premises;
- expenses for payment for information, audit, consulting, etc. services;
- taxes paid by the organization as a whole (property tax, transport tax, land tax, etc.);
- other expenses similar in purpose arising in the process of managing the organization and due to its maintenance as a single financial and property complex
Management expenses
Management expenses
Management expenses - expenses not related to the production or commercial activities of the enterprise: the costs of maintaining the personnel department, the legal department, the automated control system, OH&S department, lighting and heating of non-production facilities, business trips, communication services, etc.
In English: management overhead
Synonyms: Administrative expenses
English synonyms: administration overhead
Finam Financial Dictionary.
See what "Administrative expenses" are in other dictionaries:
Expenses not related to the production or commercial activities of the enterprise: the cost of maintaining the personnel department, legal department, lighting and heating of non-production facilities, business trips, communication services, etc. ... ... Glossary of business terms
management expenses- All expenses not related to the production or commercial activities of the company, namely: the cost of maintaining the personnel department, the legal department, the department of automated control systems, OH&S, lighting and heating of non-production facilities, ... ...
MANAGEMENT EXPENSES- (English management expenses) - expenses for managing the organization. U.r. make up part of the current expenses of the organization, forming the cost of products (works, services). In boo. accounting U.r. are reflected in the debit of the account of general business expenses. ... ... Financial and Credit Encyclopedic Dictionary
MANAGEMENT EXPENSES- economy. (from English management expenses) expenses for managing an organization. U.r. make up part of the current expenses of the organization, forming the cost of products (works, services). In boo. accounting U.r. are reflected in the debit of the account of general business ... ... Universal additional practical explanatory dictionary by I. Mostitsky
Selling and management expenses- "Commercial and administrative expenses" (Commercial and administrative expenses) - an income statement item that includes costs that are not directly related to the manufacture of products or the provision of services, as well as the payment ... ... Economic and Mathematical Dictionary
Expenses for the maintenance of the administrative apparatus and its maintenance. They include the costs of maintaining public authorities and public administration, the apparatus of general economic management (ministries, departments, main ... ... Great Soviet Encyclopedia
administrative expenses- Expenses for the maintenance of the administrative apparatus; expenses for the maintenance of official cars; expenses for the maintenance of protection; business travel expenses. Accounting topics... Technical Translator's Handbook
fixed costs- Administrative expenses allocated in the reporting as a separate line, depreciation of fixed production assets, expenses for the maintenance and repair of equipment, etc. In the group P.r. includes taxes attributable to the cost of production and not ... ... Technical Translator's Handbook
COSTS, FIXED- administrative expenses allocated in the reporting as a separate line, depreciation of fixed production assets, expenses for the maintenance and repair of equipment, etc. In the group P.r. includes taxes attributable to the cost of production and not ... ... Big accounting dictionary
Expenses of the insurance company, including: acquisition expenses; collection expenses; management expenses. See also: Cost of doing business Competitiveness of the insurer The balance sheet profit of the insurance company Financial dictionary Finam ... Financial vocabulary
Every enterprise is obliged to form according to the results of activities for the period, a report on financial results. The result is either profit or loss, which depends on the amount of expenses and income of the subject.
In accounting
In accordance with the latest accounting law, adopted in November 2011 No. 402-FZ, expenses are attributed to objects of double entry of a company or individual entrepreneur. Among Russian standards, it regulates the expenditure side of accounting PBU 10/99.
According to these two acts, costs are the incurrence of liabilities or the disposal of assets, leading to a decrease in the capital and economic benefits of the firm. All company expenses are taken into account accrual only, the moment depends on a number of conditions.
Aggregated costs are divided into ordinary activities, as well as others.
Depending on the criteria, spending is divided into many different groups and blocks.
In the ordinary course of business, firms have some of the most significant and major articles used to record disposal transactions and liabilities:
- for the main production - account 20;
- for auxiliary production - account 23;
- overhead expenses - account 25;
- general business expenses - account 26;
- for implementation - .
Example: the Yasmina company for July wrote off the cost of production materials - 50,000 rubles, accrued salaries to the shop workers - 200,000 rubles, insurance premiums to the off-budget system - 60,000 rubles, depreciation deductions amounted to 30,000 rubles, deferred costs for June were written off - 15000 rub. How are the general production and economic expenses distributed (in rubles)?
ODA:
- salary of production workers - 70,000;
- insurance payments - 21000;
- depreciation - 5000;
- materials for production - 25000;
- payment to suppliers and debtors - 100,000.
- administrative staff salary - 130,000;
- insurance premiums - 39000;
- depreciation - 18000;
- counterparties and debtors - 80,000;
- June deferred expenses - 3000.
Total OHR - 270000 rubles.
There were no finished products at the beginning of July. During the month, 20 units of products were produced, and 5 units were not completed. The result of all production costs (accounts 20, 25 and 26) is 800,000 rubles.
In the regulation on UCH, the formation of the cost price is indicated in full. The production of 20 units accounts for 680,000 rubles. out of all expenses.
Unit cost:
680000 / 20 = 34000 rubles
800000 - 680000 = 120000 rubles
What share of the total cost is OHR:
270000 / 800000 = 0.34 or 34%.
In unit cost:
34000 * 34% = 11560 rubles
In the cost of output of all finished products:
11560 * 20 = 231200 rubles
In the cost of output of refineries:
270000 - 231200 = 38800 rubles or 38800 / 120000 = 32%.
Finished products can be reflected in the balance sheet in one of three estimates, depending on the accounting policy of the organization:
- Based on actual production cost.
- According to the standard (planned) production cost, including the costs associated with the use of fixed assets, raw materials, materials, fuel, energy, labor resources in the production process, and other production costs.
- Direct cost accounts.
This method of valuation of WIP (at actual production cost) corresponds to a similar method of valuation of WIP. Recorded in accounting following correspondence:
Debit 90 “Sales”, subaccount “Cost of sales” Credit 43 “Finished products”, write-off of the cost of sold finished products
The sum of all similar entries for the reporting year forms an indicator of the cost of goods sold, products, works, services in the income statement.
As for the second method, you need to know the number of units sold. Presumably, out of 20 products released, 15 were sold.
The cost of the remaining products:
680000 / 20 / 15 \u003d 2267 rubles.
Cost of sale:
34000 * 15 = 510000 rubles
OHR in the cost of sales for July products:
11560 * 15 = 173400 rubles.
Checking the correctness of the calculation:
173400 / 510000 * 100 = 34%.
Recognition as semi-permanent
In this case, the original data will be used. The total expenses amounted to 800,000 rubles, of which 20 on the account, i.e. for the main production - 100,000 rubles. It was planned to release 25 units of products, in fact only 20 are ready.
Plan:
100000 / 25 = 4000 rubles
Settlements (in rubles):
- Cost of finished products: 4000 * 20 = 80000.
- Unit cost: 4000.
- Refinery cost: 100,000 - 80,000 = 20,000.
- Cost of sales: 4000 * 15 = 60000.
- Cost of remaining finished products: 4000 * 5 = 20000.
- : 8000 (unit selling price) * 15 = 120000 * 118% (VAT) = 141600.
- VAT: 8000 * 15 * 18% = 21600.
- Financial result: 141,600 - 21,600 - 60,000 - 270,000 (OHR) = 210,000 rubles - the company's loss for July.
Should the management expenses of Yasmina be excluded from the cost of sales of goods, services, works, products and be included in a separate column of management expenses? An analysis of the law on accounting, PBU 4/99, Order of the Ministry of Finance of Russia No. 67n allows us to answer that no, they may not be excluded.
For confident accounting in this way, it is better to explain the amount of management costs written off by the accounting method in the explanatory notes to the income statement so as not to arouse suspicion and claims from the fiscal authorities.
The moment of recognition of expenses is described in this video.
Management expenses are expenses that are not related to production activities. For example, salaries of administrative staff, maintenance and service of the office, postage and advertising costs. In the article, we will figure out what else is included in management expenses, how to reflect them in accounting and determine the financial result.
In this article you will learn:
What is management costs
Management costs are those costs of the organization that cannot be associated with the production process, that is, they do not participate in the production of goods or services. For example, if the workers of the production shop received wages, then this item of expenditure is attributed to the cost of production, and the salary of the chief accountant should be included in management expenses, since he does not participate in the production of products. If the costs can be attributed to at least one of the directions of production of the organization, then they are already considered commercial. Management can be included in the cost of production, but not all at once, but by distributing between all types of manufactured products in proportion to revenue for a certain period (month, quarter, year). .
Download and get to work:
What will help: plan administrative and management expenses and minimize the risk of including unreasonable costs in the budget.
What is included in management costs
These usually include the following costs:- for salaries and insurance premiums of administrative personnel not directly related to the production process;
- administrative (for business trips, postal and advertising, office needs (water, tea, coffee, cleaning products, etc.);
- communication and telephony, Internet costs;
- representative;
- transport;
- for consulting services, for auditors, appraisers, etc.;
- for the lease and maintenance of administrative premises (not of an industrial nature);
- depreciation of fixed assets for general economic purposes;
- repair of fixed assets for administrative and general purposes, etc.
The specified list is not complete, it can be supplemented with certain articles depending on the specifics of the organization's activities (for example, the maintenance of a canteen, a medical center, security, cleaning the area in front of the building, etc.).
Read also:
How it helps: In many companies, the planning of administrative and management expenses is delayed for months. But even during this time, it is not always possible to develop a reliable budget, since a large number of participants are involved in the coordination process, each of which tries to approve, in other words, “slip through” additional cost items. Nevertheless, a realistic budget for these expenditures is quite within our power, and deviations on it will not exceed 5-10 percent.
What will help: Two-thirds of your colleagues monitor the company's key financial indicators weekly and spend half a day on it. We learned how to turn an accounting program into a convenient system for monitoring and managing a business with our own hands.
Accounting
Despite the fact that management expenses are not directly related to the main production activities of the enterprise, they are reflected in the expense accounts, namely, on account 26 “General business expenses”. There are two ways to write them off:
1. They are recognized as conditionally permanent and are written off at the end of the month to the cost of production. for this, the following entry is made in the accounting registers: Debit 90 “Sales” Credit 26 “General expenses”. This order must be indicate in the accounting policy of the organization. Posting means that administrative expenses are written off to the cost of goods manufactured in the month in which they are taken into account in the expenses of ordinary activities.
Important! It is possible to write off the entire account 26 "General expenses" for the cost of production, provided that this account is used only to account for administrative expenses. Otherwise (when the organization takes into account both administrative and production expenses on account 26), the specified entry will be considered incorrect.
2. When management costs are divided into semi-fixed and semi-variable costs. In this case, semi-fixed costs are written off similarly to the previous paragraph. But in writing off conditional variables, options are possible:
- when it can be attributed to the main production, an entry is made Credit 26 “General business expenses” Debit 20 “Main production”;
- if they relate to auxiliary production, then the entry in the accounting registers will be Debit 26 “General business expenses” Credit 23 “Auxiliary production”;
- if they relate to a service economy - Debit 26 “General business expenses” Credit 29 “Serving industries or farms”.
Important! If there were no sales in the reporting period, management expenses can be written off to account 91 “Other income and expenses” sub-account “Other expenses”. This is the view of some economists.
In the accounting (financial) statements, management expenses are reflected only in the Statement of Financial Results (form 2) in line 2220 “Administrative expenses”.
Important! Line 2220 of the Statement of Financial Results is filled out only if the company has chosen the first method of accounting for management expenses, that is, they are not distributed by calculation objects and there are no postings using accounts 20, 23, 29. Otherwise, management expenses make up the cost of manufactured products and are reflected in line 2120 "Cost of sales".
More on the topic:
How it will help: find out effective ways to reduce the cost of rent, staff, and fleet maintenance.
How it will help: if you are not sure about the accuracy of profits, you should make sure that all expenses from the income statement are taken into account correctly. And that includes management. It is possible that they are used twice in the report or deliberately distorted. Learn more about how to check the accounting for such expenses in this solution.
tax accounting
The Tax Code of the Russian Federation does not contain such a thing as management costs, but it does contain the concept of indirect costs. Indirect costs are the costs of the organization that cannot be directly attributed to the production of products and can be recognized as expenses in the period in which they are incurred. Thus, indirect costs include, for example, communication services, rent, insurance, etc. The most important difference between indirect costs and direct costs is that they are fully related to the costs of the current reporting (tax) period. The exception is organizations that do not produce anything, but are engaged in the provision of services. The company decides on its own which costs to attribute to direct or indirect costs for each individual production cycle.Indirect costs include:
- for the maintenance of administrative and managerial personnel;
- for the lease of premises or equipment, machinery that is not directly involved in the production of goods;
- for property insurance;
- for information, consulting and audit services;
- utilities, etc.
- accrued taxes and fees, advance payments on them are reflected in line 041;
- depreciation amounts are shown in lines 042 and 043;
- costs for the acquisition of land plots and rights to conclude a land lease agreement - on line 047, etc.
