Question

In order to know the factory cost of production which account is prepared?

• A. Production A/c
• B. Manufacturing A/c
• C. Trading A/c
• D. Profit and loss A/c

Answer 1

The correct option is B Manufacturing A/c

Manufacturing a/c is prepared by the enterprises engaged in manufacturing activities. This financial statement does not show profit and loss figures but rather the cost of direct materials and labour. A manufacturing account also includes production overhead. Manufacturing a/c shows the cost of goods manufactured.