Question

Why does work manager's salary go in trading Account-?

Answer 1

Dear student,

The revenue expenditures that are related to the production of goods and services (i.e. expenses incurred in the factory) are considered as direct expenses and are charged from the Trading Account. While all other revenue expenditures except direct expenses like, office and selling expenses etc. (i.e. expenses incurred in the office) are considered as indirect expenses and are charged from the Profit and Loss Account.

Assuming that work manager salary is a direct expense in nature so it will be taken to trading account

Regards