costs are divided into direct and indirect on the provisions of Article 318 of the Tax Code.The legislation has defined a particular list.
So, refer to the direct costs:
- the purchase of materials and raw materials used in production.
- the purchase of components or semi-finished products.
- payroll employees directly involved in the production process.These expenses include payments for compulsory pension insurance, to finance and insurance funded retirement pension credit and other deductions.
- depreciation of fixed assets used in production.
In the category of indirect cost includes the sum of all other costs, with the exception of extraordinary.The list includes not only the costs of the Tax Code, and in the Declaration on the income tax.
Why share the direct and indirect costs?
In this regard it should be noted the main difference between the cost.So, in the amount of indirect costs relate entirely to the cost of the current tax (reporting) period, and direct - to the cost of the period, as sales of goods, taking into account the balances of work in progress.The exception is when a company focuses on the provision of services.
It should be noted that the list, which determines the direct and indirect costs and resulted in the Tax Code, is required.However, the company may, at its discretion, to add to the one or the other list your expenses.
If the accounting policy direct and indirect costs not specifically defined, the default is considered that they comply with the list of article 318 of the Tax Code.And with the introduction of legislation to set a list of changes, the company will have to take them into account.In this regard, it is better to adopt the direct and indirect costs of their own in the accounting policy of the company.
Separation costs in management accounting allows you to use a simplified form of accounting, revenue forecast.In accordance with a given amount of income by dividing the costs can calculate the optimal volume of trade, as well as the appropriate level of costs.At the same time determines whether the sales or other types of products.
As one of the practical results of the application of the classification of costs in accordance with the principle of depending on the sales volume is the possibility of forecasting income.This takes into account the expected state spending, the definition of sales, which will provide a break-even basis, for each specific case.
analysis of the direct and indirect costs allows us to study the structure and composition of production costs in order to determine the main directions of the search for reserves to their reduction.At the same time it is possible to study the dynamics of changes in the costs of the current period compared to the previous, and the plan as a whole and its individual articles.The analysis allows to establish and quantify the factors that influence changes in the costs to determine the contribution of each individual unit in the overall result achieved by the company to lower costs.In addition, it is possible to identify and quantify the reserves to lower costs for production and distribution of goods.
tasks facing the accounting, have much in common with the tasks performed by management analysis, this is due to the fact that the inclusion of the management accounting is considered a subsystem.
In practice, specifically to determine which expenses are direct, indirect and which is not always possible.Much of this depends on the type of the company.
