Closing stock refers to the inventory remaining within an organization at the end of an accounting period, including raw materials, work in progress, or finished goods. It plays a crucial role in determining the profitability and financial status of a company.
The costs incurred in a production process as a result of which raw material is converted into finished goods. The conversion costs usually include direct labor and manufacturing overheads but exclude the costs of direct material itself.
Derived demand refers to the demand for capital goods and labor, used in production, which indirectly stems from the demand for the final goods and services that these inputs help to produce.
Finished goods are products that have completed the manufacturing process and are ready for distribution to customers.
A method of valuing raw materials or finished goods by using the earliest unit value for pricing issued items until all stock received at that price has been used up. This method is significant in inventory management and accounting, ensuring a logical and often tax-efficient way to evaluate inventory costs.
Inventory includes the raw materials, work-in-progress, and finished goods that a company has on hand at any given time. Effective inventory management is crucial for maintaining liquidity and profitability.
Inventory Valuation involves determining the monetary worth of raw materials, work-in-progress, and finished goods, as prescribed by specific accounting standards. It plays a critical role in both financial and management accounting.
Manufacture refers to the process of making or fashioning products, often in large quantities, using hands or machinery. This term is commonly associated with industrial production, where raw materials are transformed into finished goods.
The manufacturing cost of finished goods refers to the total expense incurred to produce a finished product. This includes the direct materials, direct labor, and manufacturing overhead costs associated with the production process.
Manufacturing inventory refers to the parts or materials on hand, needed for the manufacturing process. Adjusting manufacturing inventory to current production needs is a critical management responsibility.
A comprehensive report detailing the cost of production in a manufacturing firm, prepared to assess the financial performance of the company's production activities.
NIFO cost is a method of valuing units of raw material or finished goods issued from stock by using the next unit price at which a consignment will be received for pricing the issues.
Opening Stock represents the inventory held by an organization at the beginning of an accounting period, including raw materials, work in progress, and finished goods. It plays a crucial role in assessing the financial performance and stock levels of a company.
Raw material refers to the primary substances used as a component in the manufacturing process of finished goods. For instance, wool serves as the raw material in the production of woolen sweaters.
Stock budgets are formulated under a budgetary control system to plan the levels of materials, work in progress, and finished goods, both in volumes and values, at specified times throughout a budget period.
Stores in accounting refer to the part of an organization where various inventories are stored, which can include stationery stocks, maintenance components, production tools, raw materials, work in progress, and finished goods.
Vertical integration refers to a strategy where a firm takes control over several production or distribution steps involved in the creation of its product or service. This can include owning the suppliers of raw materials, the manufacturing process, and the distribution channels.
