Accounting and methods for the distribution of overhead and general expenses

The profitability of any economic entity depends on the correct reflection and accounting of costs. Their optimization, control, distribution affect the cost of goods (services), reduce the risk of tax sanctions. At the initial stage of activity, each company plans and creates a list of costs necessary for the implementation of production processes. An important aspect reflected in accounting policies is the distribution of general production and general business expenses.

Cost classification

The pricing policy of the enterprise is formed taking into account the market situation regarding a certain type of goods, services or work, while the regulation of value occurs due to the amount of invested profit or the redistribution of commercial expenses. Production costs - this is a constant value, which consists of indicators of actual costs. The selling price (of works, services, goods) includes the cost, selling expenses and the amount of profit.

Each organization in the accounting policy forms the provisions governing the accounting of expenses, methods for their distribution and write-off. Accounting normative acts (Tax Code, PBU) recommended a list and classification of costs related to cost. The consumption rate for each article is established by the internal documents of the enterprise. Costs are systematized according to various criteria: by economic content, by time of occurrence, by composition, by the method of inclusion in the cost price, etc. To form a calculation, all expenses are divided into indirect and direct. The principle of inclusion in the cost depends on the number of types of products manufactured by the company or the services provided. Methods for the distribution of direct costs (wages, raw materials, depreciation of basic equipment) and indirect (ODA and OXR) are determined in accordance with regulatory documents and internal company regulations. In more detail, it is necessary to dwell on general and general production costs, which are included in the cost by the distribution method.

ODA: composition, definition

With an extensive production structure aimed at the production of several units of products (services, works), an enterprise incurs additional costs that are not directly related to the main activity. In this case, the accounting of expenses of this type must be kept and included in the cost. The structure of ODA is as follows:

- depreciation, repair, maintenance of equipment, machinery, intangible assets for industrial purposes;

- maintenance, modernization of workshop premises;

- deductions to funds (FSS, PFR) and wages of personnel serving the production process;

- utility costs (electricity, heat, water, gas);

- other expenses directly related to the production process and its management (write-off of used inventory, IBE, travel expenses, rental of premises, services of third-party organizations, ensuring safe working conditions, maintenance of auxiliary units: laboratories, services, departments, leasing payments). Production costs - these are the costs associated with the management process of the main, service and auxiliary units, they are included in the cost as general production costs.

Accounting

Methods of distribution of overhead and general expenses are based on the total value of these indicators accumulated during the reporting period. To summarize information on ODA in the chart of accounts, a cumulative register No. 25 is provided. Its characteristic: active, collectively distributive, does not have a balance at the beginning of the month and the end (unless otherwise provided by the accounting policy), analytical accounting is carried out by units (workshops, departments) or types of products. During a certain period, the debit of account 25 accumulates information on actually incurred expenses. Typical correspondence includes the following operations.

• Dt 25 Kt 02, 05 - the accrued amount of depreciation of fixed assets, intangible assets, is allocated to ODA.
• Dt 25 Kt 21, 10, 41 - goods of own production, materials, inventory are written off as production costs.
• Dt 25 Kt 70, 69 - payable to salaries to ODA personnel, deductions to extrabudgetary funds.
• Dt 25 Kt 76, 84, 60 - invoices for services rendered, work performed, charged by counterparties are attributed to general production expenses, the amount of shortages revealed by the inventory is written off.
• The debit turnover of account 25 is equal to the amount of actual expenses, which at the end of each reporting period are debited to the calculation accounts (23, 29, 20). In this case, the following accounting record is compiled: Dt 29, 23, 20 Kt 25 - accumulated expenses are written off to auxiliary, main or servicing production.

Distribution

The amount of overhead costs can significantly increase the cost of manufactured products, works performed, services rendered. At large industrial enterprises of ODA, the concept of “consumption rate” is planned and introduced, the deviations of this indicator are carefully studied by the analytical department. In organizations engaged in the creation of one type of product, methods for the distribution of general production and general business expenses are not developed, the sum of all costs is fully included in the cost. The presence of several production processes implies the need to include all types of costs in the calculation of each of them. Distribution of expenses of general production value can occur in several ways:

1. In proportion to the chosen base indicator, which optimally corresponds to the ODA bundle and the value of output (volume of goods produced, wage funds, consumption of raw materials or materials).
2. Maintaining separate accounting for ODA for each type of product (costs are reflected in the analytical sub-accounts opened for register No. 25).

In any case, the methods of distribution of indirect costs should be fixed in the accounting policy of the enterprise and not contradict regulatory acts (PBU 10/99).

OXR, composition, definition

Administrative costs are a significant amount in the cost of goods, work, products, services. General expenses are the total reflection of management costs, they include:

- maintenance and maintenance of structures, non-production buildings (offices, administrative areas), rental payments;

- deductions to social funds and remuneration of management personnel;

- communication and Internet services, security, postal, consulting, audit costs;

- depreciation for objects of non-productive use;

- advertising (if these expenses are not commercial);

- office, utility bills, information services;

- expenses for staff training and compliance with occupational safety rules;

- other similar costs.

The content of the administrative apparatus is necessary for the implementation of production processes and the further marketing of products, but the high proportion of this type of expenses requires constant accounting and control. For large organizations, the use of the normative method of accruing OCR is unacceptable, since many types of administrative expenses are variable or, with a one-time payment, are transferred to the cost of production in stages, over a period of time.

Accounting

Account No. 26 is intended to collect information about the management expenses of the company. Its characteristic: active, synthetic, collective distribution. It is closed monthly on accounts 20, 46.23, 29, 90, 97, depending on what methods of distribution of general production and general business expenses are adopted by the internal regulatory documents of the enterprise. Analytical accounting may be conducted in the context of units (departments) or types of products (works performed, services rendered). Typical account operations:

• Dt 26 Kt 41, 21, 10 - the cost of materials, goods and semi-finished products has been written off at OXR.
• Dt 26 Kt 69, 70 - reflected the payroll of administrative staff.
• Dt 26 Kt 60, 76, 71 - general business expenses include services of third parties paid for to suppliers or through accountable persons.
• Dt 26 Kt 02, 05 - depreciation of non-production objects of intangible assets and fixed assets was accrued.

Direct cash costs (50, 52.51) are usually not taken into account as part of OXR. An exception may be accrual of interest on loans and borrowings, while this method of accrual should be spelled out in the accounting policies of the enterprise.

Write-off

All general business expenses are collected in monetary terms as the debit turnover of the account 26. When the period is closed, they are written off to the main, servicing or auxiliary production, can be included in the cost of goods to be sold, be charged to deferred expenses or partially directed to the loss of the enterprise. In accounting, this process is reflected in the entries:

• Dt 20, 29, 23 Kt 26 - are included in the cost of production of the main, serving and auxiliary industries.
• Dt 44, 90/2 Kt 26 - General expenses are written off in trading enterprises, the financial result.

Distribution

General business expenses in most cases are written off in the same way as general production expenses, i.e., in proportion to the selected base. If this type of cost has a long-term nature, then it is more expedient to attribute them to future periods. Write-off will occur in certain parts attributable to cost. Conditionally variable general business expenses can be attributed to the financial result or included in the price of the goods produced (in trade enterprises or providing services). The distribution method is regulated by internal documents.

1C

Currently, the accounting of overhead and general expenses is kept in the accounting databases and programs of the 1C group. The methods of distribution of indirect costs are regulated by special settings. When calculating the cost of ODA and OXR, it is necessary to put flags in front of the approved base in the “production” tab. When writing off expenses for future periods, it is necessary to establish the period and amount. To include costs in the financial result, the corresponding tab is filled. When the "period closing" function is launched, overhead and general expenses accumulated in 25 and 26 registers are automatically debited to the specified accounts. This process forms the cost of the finished product.