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Question

Which of these is/are not shown in manufacturing a/c?

A
Work in progress
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B
Royalty
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C
Bad debts.
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D
Factory insurance
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Solution

The correct option is C Bad debts.
Cost incurred in the manufacturing process, but they cannot be traced directly to the goods being produced. Include indirect materials, indirect labour and indirect expenses. Indirect expenses related to the factory, machinery and vehicles are debited to manufacturing account. Hence, bad debts is not shown in manufacturing account.

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