accounting for labour,materials — OpenTuition Forums

Eeddie24716y ago

hi guys,this is mainly to do with the double entry or the ledger entries for accounting for labour and materials and any other area in management accounting that requires ledger entries......
would the double entry skills or knowledge acquired in financial accounting ie f3,bear any relation to the double entry skills associated with management accounting,in other words are the general double entry principles the same as regards both management and financial accounting or is there a distinct difference when trying to apply these techniques,eg in financial accounting,one of the general rules would be that when assets increase,debit entries are made to their
respective accounts ie purchases,stocks etc,would we be wrong or right to take this knowledge into management accounting as well and apply it?

help!!!!!!!

Aabdulwahabsiddiq16y ago#1

The double entries are basically adding and subtracting as we do in our school times.In other words we can say that entries are the systematic way of do add and subtract.for example you purchase asset you do DR entry to asset account and CR to cash account , Simply what you do is adding the value to existing assets and lessing the cash.In management accounting you also do add and subtract for example by purchasing inventory you just add to raw material ,when you pay to labour you less the cash and adding to the expence account.we simple seperate the direct and indirect material and labour, taking from the stock a/c to WIP(work in progress) if direct and to prduction OH if indirect.entries are the way in which we adding to the account and taking out from the account , you can simply do that on your fingers.There is no extra thing .In management accounting we can apply this system of entries used in financial accounting because its simply the way in which we account the things we are doing.So entries are not for financial it is also use in management.Every manager is also a financial accountant and every financial accountant knows about the management but the are specialised in the field.
Hope this answer you question. if you have any question in your mind you can ask again.

Ssaroj11y ago#2

I did not find numericals solution?

John MoffatTutor11y ago#3

Saroj: What do you mean? You did not find numericals solution to what????? Double entry is not really needed for Paper F2. If you are asking for numerical solutions to questions in our course notes, then try watching the lectures (or even looking at the answers in the course notes - the page number is on the contents page)

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