Cost of Production
Book a Trial Class
One-hour paid trial · Same-day reply · from RM50/hr
MS: Kos Pengeluaran · EN: Cost of Production · ZH: 生产成本
Meaning
Cost of production is the total cost of producing finished goods in a period. It is obtained by adding prime cost and manufacturing overhead, then adjusting for opening and closing work in progress. The cost of production is transferred to the Trading Account as the cost of finished goods.
Example
Ceria Toy Factory has a prime cost of RM60,000 and overhead of RM20,000. After adding opening WIP of RM3,000 and deducting closing WIP of RM5,000, the cost of production is RM78,000.
Source: DSKP KSSM Prinsip Perakaunan Tingkatan 5