MINISTRY OF FINANCE ACADEMY OF FINANCE ACCOUNTING FACULTY -------***------- GRADUATION THESIS ACCOUNTING FOR PRODUCTION COST AND PRODUCT COSTING AT HANOI – HAI PHONG BEER JOINT STOCK COMPANY Teacher : PhD. Thai Ba Cong MSc. Nguyen Ba Linh Hanoi – 2021 COMMITMENT I hereby declare that the dissertation entitled “Cost accounting and product cost calculation at Hanoi – Hai Phong Beer Joint Stock Company” is the research work my own under the guidance of…, the data, the results stated in the dissertation is honest, comes from the actual situation of Hanoi – Hai Phong Beer Joint Stock Company. Dissertation writer 2 TABLE OF CONTENTS INTRODUCTION.
8 CHAPTER 1: THE GENERAL THEORY OF ACCOUNTING FOR PRODUCTION COST AND PRODUCT COSTING AT MANUFACTURING ENTERPRISES. The need of accounting for production cost and product costing at manufacturing enterprises. Concept, essence of production cost and product cost. Management requirements for accounting for production costs and product costing.
Tasks of accounting for production cost and product costing:. Classification of production costs and product costs:. Classification of production costs:. Classification of product costs:.
Objects of production cost accounting and product costing. Objects of production cost accounting:. Objects of product costing. The relationship between objects of production cost accounting and objects of product costing.
Accounting for production costs according to the utility purpose of costs. Accounting for direct raw material costs. Accounting for direct labour costs. Accounting for production overhead costs.
Accounting for production costs for the whole enterprise. Methods of valuing closing work in progress. Valuing closing work in progress based on direct material costs. Valuing closing work in progress based on equivalent units.
Product costing method in enterprises. Organization of production cost accounting and product costing in terms of information technology application.1 Functions and duties of production cost accounting and product costing in terms of information technology application. Principles and order of accounting for production cost and product costing in terms of information technology application:. Accounting book to accumulate production costs and product costs:.
35 CHAPTER 2: ACTUAL SITUATION OF ACCOUNTING FOR PRODUCTION COST AND PRODUCT COSTING AT HANOI – HAI PHONG BEER JOINT STOCK COMPANY. Overview of Hanoi – Hai Phong Beer Joint Stock Company. History of establishment and development of Hanoi – Hai Phong Beer Joint Stock Company:. Organizational characteristics of production and business activities in Hanoi – Hai Phong Beer Joint Stock Company.1 Organizational and management characteristics of Hanoi - Hai Phong Beer Joint Stock Company.
Organizational characteristics of accounting work at Hanoi – Hai Phong Beer Joint Stock Company. Actual situation of production cost accounting and product cost calculation at Hanoi – Hai Phong Beer Joint Stock Company. Objects and accounting methods for accumulating production costs:. Classifiaction of production costs:.
Accounting for production cost:. Actual situation of product costing at Hanoi – Hai Phong Beer Joint Stock Company. General assessments of accounting for production cost and product costing at Hanoi – Hai Phong Beer Joint Stock Company.112 CHAPTER 3: SOME COMMENTS TO IMPROVE ACCOUNTING FOR PRODUCTION COST AND PRODUCT COSTING AT HANOI – HAI 4 PHONG BEER JOINT STOCK COMPANY. Development orientation of Hanoi – Hai Phong Beer Joint Stock Company.
Principles and requirements for improving accounting for production cost and product costing at Hanoi – Hai Phong Joint Stock Company. Principles for improving accounting for production cost and product costing at Hanoi – Hai Phong Joint Stock Company. Requirements for improving accounting for production cost and product costing at Hanoi – Hai Phong Beer Joint Stock Company. Solutions to improve accounting for production cost and product costing at Hanoi – Hai Phong Beer Joint Stock Company.134 5 LIST OF DIAGRAMS IN THE DISSERTATION No.
Name Page Diagram of the major accounting transaction on direct raw 1.2 Diagram of the major accounting transaction on direct labor cost 24 Diagram of the major accounting transaction on production 1.3 25 overheads Diagram of accounting of production cost of the whole enterprise 1.4 26 according to the perpetual inventory method Diagram of accounting of production cost of the whole enterprise 1.5 28 according to the periodic inventory method 2.1 The stages of the beer production at the company 44 2.2 Technological process of beer production at the company 47 2.3 Organizational structure in the company 48 2.4 Organizational chart of the company’s accounting department 53 2.5 Accounting procedure on BRAVO 7 60 3.1 Accounting for loss due to unplanned damaged products 128 3.2 Accounting for loss due to planned damaged products 128 3.3 Accounting for production stoppage losses in the plan 129 3.4 Accounting for unplanned production stoppage losses 130 6 LIST OF TABLES IN THE DISSERTATION No.1 Table of raw material norm for the beer production 64 2.4 Allocation table insurance 75 2.5 Table of tools and supplies 86 2.6 Assets summary table 91 2.7 Table of costing 100 2.8 Table of costing and factors of increase and decrease 102 2.9 Price list and other factors (the norm method) 104 2.1 Planned product cost list according to actual output 106 0 2.1 Table of product costing of Hai Phong Beer 107 1 2.1 Table of product costing 107 2 7 INTRODUCTION 1. The urgency of the research: Our country’s economy is currently a market economy, enterprises that want to exist and develop must satisfy market demand, or in other words, businesses must comply with the law of supply and demand, the law of value and especially the law of competition in the market. In order for the products to stand firm in the market, companies must promote market research, change product designs accordingly, improve product quality and reduce costs. In order for their products to stand firm in the market, enterprises must promote market research, change product designs accordingly, improve product quality and reduce costs.
In order to do that, companies must manage production cost effectively, record cost fully and promptly to calculate production cost accurately. From there, there are measures to help business improve their competitive advantage in the market. In terms of the whole economy, lowering the product cost of enterprises brings about an increase in the economy's accumulation. Therefore, lowering product costs is not only a matter of businesses but also a matter of concern for the entire industry and society as a whole.
Doing a good job of gathering and calculating product costs will help business calculate costs accurately to determine the business performance. At the same time, it will provide necessary information for the management and apparatus, so that managers can come up with appropriate strategic measures to help companies use capital effectively and proactive in the business activities. Aware of the importance of the problem, I chose the topic “Accounting for production cost and product costing at Hanoi – Hai Phong Beer Joint Stock Company” as the research topic for my thesis with the desire to find useful solutions to contribute to the work of renewing management methods of Hanoi – Hai Phong Beer Joint Stock Company. Research purpose: Firstly, systematize the theoretical bases of accounting for production cost and product costing.
Secondly, study the actual problems of accounting for production cost and product costing at Hanoi – Hai Phong Beer Joint Stock Company, combine comparision and contrast with the general theoretical basis of accounting system to evaluate and comment on the current status of this accounting practice. Thirdly, give conclusions and proposals to improve accounting for production cost and product costing at Hanoi – Hai Phong Beer Joint Stock Company, and at the same time provide conditions for the implementation of those proposals. Object and scope of the research: - Object of the research: Accounting for production cost and product costing at Hanoi – Hai Phong Beer Joint Stock Company. - Scope of the research: Learn and evaluate the accounting for production cost and product costing at Hanoi – Hai Phong Beer Joint Stock Company.
Research methods: To study the issues raised, the author uses qualitative and quantitative methods to research through specific tools and methods, which are data collection and data analysis processing. Primary data collection method: - Interview method: The author uses this method to collect information on accounting for production cost and product costing at Hanoi – Hai Phong Beer Joint Stock Company. - Methods of field research: The author directly observes at the accounting department in general and production cost and product costing team in particular. The author studies the behaviour of administrators and accountants who practice accounting for production cost and product costing.
Secondary data collection method: 9 Secondary data is pre-existing data that has been collected. Through questionnaires, previous interviews or information obtained through researching documents of Hanoi – Hai Phong Beer Joint Stock Company, newspapers, internet. are used as the basis to analyze the current situation of the enterprise in terms of assets, capital sources, business results and collect data on production cost accounting and product cost calculation of the enterprise. The structure of the thesis: Apart from the introduction and conclusion, the content of the dissertation consists of the following three chapters: Chapter 1: The general theory of accounting for production cost and product costing at manufacturing enterprises.
Chapter 2: Actual situation of accounting for production cost and product costing at Hanoi – Hai Phong Beer Joint Stock Company. Chapter 3: Some comments to improve accounting for production cost and product costing at Hanoi – Hai Phong Beer Joint Stock Company. 10 CHAPTER 1: THE GENERAL THEORY OF ACCOUNTING FOR PRODUCTION COST AND PRODUCT COSTING AT MANUFACTURING ENTERPRISES 1. The need of accounting for production cost and product costing at manufacturing enterprises 1.
Concept, essence of production cost and product cost *) Production cost In a company, in order to conduct production and business activities, there must be three basic elements: means of labour, objects of labour and labour power. The production and business activities is the process of consuming those elements to create products and services. The consumption of these factors in the process generates corresponding costs. Costs of production is the monetary expression of all costs of living labour and other necessary costs that the company have indicated in the process of production or provide service in a certain period.
So, the essence of the cost of production is: - Waste on inputs in the production process associated with business purposes - The amount of costs depends on the volume of factors of production consumed during period and the price of a unit of wasted factors of production. - Cost of production is measured in monetary terms and is determined over a specified time period. In brief, the essence of production cost is the value of costs elements transferred into the finished product. *) Product cost: Product cost is the production cost calculated for a volume or a unit of product completed by an enterprise under normal capacity conditions.
All expenses (incurred in the period, carried forward in the previous period) and 11 accrued expenses related to the volume of finished goods will make up the product cost target. Product cost is a measure of value and is an important economic indicator in the system of management indicators that help enterprises synthesize and reflect the results of using assets in the process of production and business activities as well as evaluating the results of applying the implemented solutions in order to reduce costs and increase profits of their units. *) Relationship between production cost and product cost: In essence, production cost and product cost are two-sided expressions of the production and business process, both of which are expressed in money of the costs of labour cost that enterprises have spent. However, production cost and product cost differ in scope and volume: - In terms of scope: Talking about production cost is considering the waste in the period, regardless the type of product, completed or not.
And talking about product cost is determining the most amount of specified production cost, for a given quantity of finished goods. For example, prepaid expense is an expense spent in the period and effective for many periods.