Which item is not recorded in process accounts? options
1Direct Material / માલસામાન
2Direct Labour / મજૂરી
3Power and Fuel Expense / બળતણ ખર્ચ
4Donation / દાન ખર્ચ
Answers
Option 4) Donation, is not recorded in the process a/c.
Explanation:
process a/c is prepared when a raw material will go under various different processes to become a final product, so there will be a different process a/c for each of the output and for each of the process.
so all the expenses and income that will be generated while carrying out a process on a material and its completion would be recorded in this process a/c and to find out what work has been finished and how much cost has been spent till the end of the process.
option 1, 2 and 3 which are - direct material, direct labor, power and fuel expenses, these will be recorded in process accounts because these items are related to the process of the raw material to become the final product. process a/c doesn't record donation as all process cost will get transferred to costing p&l a/c but donation is not the part of any process cost. so it will not be recorded.