Accounting Account 20 Main Production is an account designed to summarize information about the costs of main production, that is, production, the products (works, services) of which were the purpose of creating this enterprise. In particular, this account is used to account for the costs of: industrial and agricultural enterprises for production; contracting, geological and design and survey enterprises to carry out construction and installation, geological exploration and design and survey work; transport and communications enterprises for the provision of services; research enterprises for carrying out research and development work; public catering enterprises producing their own products (in terms of raw materials); road facilities for the maintenance and repair of highways. Debit 20 reflects direct expenses related directly to the production of products, performance of work and provision of services, as well as expenses of auxiliary production related to the management and maintenance of the main production, and losses from defects. Direct costs associated directly with the production of products, performance of work and provision of services are written off to account 20 from the credit of accounts for inventory accounting, settlements with personnel for wages, etc. Expenses of auxiliary production are written off to account 20 from the credit of account 23 ""Auxiliary production "". , related to the management and maintenance of the main production, are written off to account 20 from accounts 25 “General production expenses” and 26 “General business expenses”. Losses from defects are written off to account 20 from the credit of account 28 "" in production "". The credit of account 20 reflects the amounts of the actual cost of completed products, work and services performed. These amounts can be debited from account 20 to accounts 40 ""Ready"", 46 ""Sales of products (works, services)", 37 ""products (works, services)"", etc. Account balance 20 at the end of the month shows the value of work in progress.
Dictionary of business terms. Akademik.ru. 2001.
See what “Accounting Account 20 Main Production” is in other dictionaries:
Dictionary of business terms
ACCOUNTING ACCOUNT 20 MAIN PRODUCTION- an account designed to summarize information about the costs of the main production, that is, production, the products (works, services) of which were the purpose of creating this enterprise. In particular, this account is used to record costs: ... ... Large economic dictionary
Dictionary of business terms
An account designed to summarize information about the costs of production that are auxiliary (auxiliary) for the main production or main activity of the enterprise. In particular, this account is used to record costs... ... Dictionary of business terms
Dictionary of business terms
An account designed to summarize information about stages of work completed in accordance with concluded contracts that have independent significance. This account is used by enterprises performing long-term work (construction... Dictionary of business terms
An account designed to summarize information about the costs of servicing the main and auxiliary production of an enterprise. In particular, the following expenses can be reflected on this account: for the maintenance and operation of machinery and equipment;… … Dictionary of business terms
An account designed to summarize information about management and business expenses not directly related to the production process. In particular, the following expenses may be reflected on this account: administrative and management... Dictionary of business terms
Dictionary of business terms
An account designed to summarize information about manufactured products, works delivered to customers and services provided for the reporting period, as well as to identify deviations in the actual production cost of these products, works, services from... ... Dictionary of business terms
Several accounts are used to account for production costs in accounting. The costs of main and auxiliary production, defects, and reserves for future expenses are listed separately. Direct costs are displayed on accounts 20 and 23, and indirect costs on accounts 25 and 26. Let's take a closer look at the main production.
Accounts
All expenses that are directly or indirectly related to the production and manufacture of products are included in their cost. They accumulate on accounts 20-29 balance. At the end of the month, they are recalculated and distributed between main and auxiliary production, individual types of products and completed work.
Primary production
Account 20 in accounting is used to display information about the costs of production, which was the purpose of creating the enterprise. Direct costs that are directly related to the production process are subject to accounting. These include the cost of materials and the cost of paying workers' salaries.
Correspondence 20 accounting accounts
Let's look at typical wiring:
- DT20 KT10 – materials written off.
- DT10 KT20 - return of raw materials to the warehouse.
- DT20 KT10-2 - semi-finished products were released into production.
- DT20 KT10-3 - fuel written off for technological purposes.
- DT20 KT60 - the cost of electricity used in production is taken into account.
- DT20 KT70 – wages accrued to production workers.
- DT20 KT69 - insurance premiums are taken into account.
- DT20 KT23 – costs of auxiliary production are taken into account.
- DT20 KT69 - a reserve has been created to pay for private entrepreneurs and vacations.
- DT20 KT25 (26) - general production (household) expenses are written off.
- DT20 KT28 - losses from defects are displayed.
In the course of its activities, an organization can attract services (products) of its own production. In this case, accounting accounts 20 and 21 are used. Semi-finished products of own production are written off from KT21 to DT20. The ending balance shows the value of work in progress (WIP). Analytics is carried out by types of costs, products, divisions. Account 20 in accounting is reflected in the balance sheet in the second section of assets in the line “Inventories”.
General production expenses
Indirect costs associated with servicing production are recorded on account 25. These include:
- depreciation of machinery and equipment;
- OS maintenance costs;
- remuneration of employees;
- insurance deductions;
- rent;
- utility costs for production premises;
- expenses for repairs of machines, buildings for general production purposes, etc.
During the month, actual costs are collected by DT from the credit of accounts for inventory, materials, settlements with personnel: DT25 KT02 (05, 10, 60), etc. Then they are written off to account 20 in accounting. This is reflected by the wiring of DT20 KT25. That is, the final balance on the account. 25 equals 0. Analytics is carried out by departments and expense items.
General running costs
Indirect costs associated with servicing the organization are displayed on account 26. These include:
- administration salary;
- social insurance contributions;
- communication costs;
- costs of maintaining security;
- administrative and management costs;
- depreciation of administrative operating systems;
- rental of office space, etc.
Expenses for the month are accumulated according to DT26. At the end of the month, these amounts are written off to account 20 in accounting or 90-2 in full.
Typical transactions for account 26 are presented in the form of a table.
| Operation | DT | CT |
| Accrued depreciation on fixed assets, intangible assets | 26 | 04, 02, 05 |
| Materials were transferred for general business needs | 10 | |
| Electricity costs included | 60 | |
| Salaries paid to workers involved in OS maintenance | 70 | |
| Insurance premiums accrued | 69 | |
| A vacation pay reserve has been created | 96 | |
| General production costs associated with auxiliary production were written off | 23 | 26 |
| General production costs associated with main production were written off | 20 | 26 |
Non-production organizations use account 26 to display information about operating expenses. Cost amounts at the end of the month are written off to DT90 “Sales”. Analytics for account 26 is carried out for each budget item, cost location, etc.
Auxiliary production
Account 23 is used to summarize information about auxiliary costs:
- service by types of energy;
- fare;
- OS repair;
- production of tools, building parts, structures.
DT23 reflects expenses directly related to the release of goods, indirect costs and losses from defects. In this case, the following transactions are generated:
- DT23KT10 – materials written off for auxiliary production.
- DT23KT70 – the wages of production workers are taken into account.
- DT23KT69 – insurance premiums have been charged.
- DT23KT25, 26 – indirect costs are taken into account.
- DT23KT28 – losses from defects are written off.
KT23 reflects the actual cost of production. These amounts are then written off to account 20 in accounting, subaccounts “Crop production” (20-1), “Livestock production” (20-2), “Industrial production” (20-3), “Other production” (20-4). Account balance 23 reflects the cost of the work in progress. Analytics is carried out by type of production.
Accounting for losses
Products that do not meet quality standards or contracts are considered defective. If it is possible to bring the product to the required parameters, then such a defect is considered correctable. DT28 displays the cost of written-off products. According to KT28 - amounts to be withheld from the culprits, suppliers, valuation of the costs of restoring the product.
Let's look at typical transactions (for convenience, we will again present them in the form of a table).
| Operation | DT | CT |
| Materials were released to correct defective products | 28 | 10 |
| Salaries accrued to employees who corrected products | 70 | |
| Insurance premiums accrued | 69 | |
| The cost of rejected products has been written off | 20 | |
| The cost of the marriage was withheld from the salary of the guilty person | 70 | |
| Received defective parts | 10 | 28 |
| Claims filed with suppliers | 76-2 |
The cost of defective products is written off from DT28 to accounting account 20. Closing the account means that all losses from the barque are compensated. Analytics is carried out by departments, expense items, types of products, culprits and causes of defects.
Service farms
Account 29 is intended to display information on production costs not related to the manufacture of products or the provision of services:
- Housing and communal services (operation of houses, dormitories, bathhouses, etc.);
- workshops;
- buffets and canteens;
- children's institutions;
- holiday homes;
- research units.
DT29 reflects expenses associated with the performance of work, which are then written off to the account for auxiliary production. According to KT29 – the cost of work and goods.
Account balance 29 reflects the cost of the work in progress. Analytics is carried out for each production and cost item.
Selling expenses
Account 44 displays information about costs associated with sales. Manufacturing businesses can use this account to show costs for:
- product packaging;
- delivery, loading of products;
- commission fees;
- maintenance of warehouse premises;
- advertising;
- entertainment expenses, etc.
Trade organizations on this account display expenses for:
- transportation of products;
- wages;
- rent;
- maintenance of buildings and equipment;
- storage of goods;
- product promotion;
- entertainment expenses, etc.
Amounts of expenses are accumulated according to DT44, and then written off to account 90-2. Analytics is carried out by product and expense items. In case of partial write-off, transportation and packaging costs are subject to distribution between months (in equal amounts, regardless of actual expenses). All other items are charged to the cost of production on a monthly basis in full.
Cost formation
The final stage is determining the cost of production, taking into account the balance of work in progress.
At the end of the month, the costs accounted for DT23 are distributed between basic and general production expenses. Then, overhead costs are written off to account 20 in accounting if reduced accounting is maintained, and all costs if full cost accounting is maintained. That is, this account displays the total amount of expenses. Formula:
S/S = WIP beginning. + Costs – WIP end.
The actual cost is reflected according to CT 20. Costs are written off depending on which valuation method is chosen. If products are accounted for at standard cost, all expenses are charged to account 40 by posting DT40 KT20. If actual cost is applied, the costs are written off to account 43. This is how account 20 is used in accounting.
Account 20 “Main production” is used in accounting to systematize expenses for the manufacture of products and (or) for the provision of services.
In particular, the account takes into account the costs:
- enterprises producing industrial and agricultural products;
- repair and agricultural service organizations involved in the maintenance and repair of cars, maintenance of farm equipment, etc.;
- transport companies;
- organizations engaged in design, survey, construction and installation work;
- research firms;
- companies engaged in the catering industry and producing their own products;
- other companies.
What other accounts is account 20 linked to?
In the debit of the “Main production” account, it is necessary to enter not only direct costs for the production of goods or the provision of services, but also indirect costs that are associated with management activities and maintenance of the production process. Direct expenses for D-t of account 20 correspond with the credit of the accounts “Settlements with personnel for wages”, “Accounting for inventories”, etc. Also D-t of account 20 is associated with K-t of the account “Auxiliary production” ( No. 23). It is from this account that the costs of auxiliary production are entered into D-t account 20.
If you need to take into account indirect expenses, you need to write them off from K-ta accounts 25 and 26 “General production expenses” and “General business expenses”.
On the debit of the 20th account, losses from defects in production are taken into account. They need to be written off from the K-tab account “Defects in production” (No. 28). The cost of goods, works and services ready for sale is recorded in the credit of the “Main production” account. The corresponding amounts must be written off to the D accounts: “Materials” (No. 10), “Finished Products” (No. 43), “Sales” (No. 90), “Product Output” (No. 40). Amounts not included in the cost must also be included in the loan. Such amounts include, for example, losses from natural disasters.
The amount remaining on account 20 at the end of the month shows what costs there are for unfinished production.
Subaccounts of account 20
Maintaining accounting records for account 20 involves opening the following 4 subaccounts:
- "Crop production";
- "Animal Husbandry";
- "Industrial production";
- "Other main production."
Subaccount 20-1 “Crop production”
Subaccount 20-1 takes into account the costs and actual yield of crop products. Crop production costs are accounted for by product type, cost item, tenant and department. Losses due to natural disasters and other force majeure circumstances, compensated by insurance companies, are attributed to D-t account 76. If production did not produce any products at all, the amount must be attributed to all costs. If the crops were not insured, then the amount must be written off as losses.
If the products are intended for feed and seed purposes, for example, seeds, silage, hay, then they must be taken into account in the debit of account 10 “Materials”. For products intended for industrial processing or sale, you need to use the “Finished Products” account (No. 43). The grass that was mowed and fed to livestock is recorded on the D-t account “Livestock” (20-2) and, accordingly, is written off from the credit of subaccount 20-1. If the products were used by grazing animals, they do not need to be received. The costs of caring for crops, pastures, pastures and pastures must be recorded as animal maintenance costs.
Feed prepared “on the side” must be taken into account as costs in subaccount 20-1, and then capitalized into account 10-7 “Feed”. The costs of sorting, drying and sorting the products of this year's harvest should also be charged to subaccount 20-1. Waste is written off according to K-that account in the debit of accounts 43 and 10.
All costs for preparing seeds for sowing and transporting them to the fields must be attributed to the costs of the corresponding agricultural crops. In subaccount 20-1, you also need to take into account all the costs associated with transporting manure to the fields. The corresponding amounts are included in costs for individual types of crops. The same can be said regarding mineral fertilizers.
Expenses for gardening, viticulture and other similar productions must include all total expenses for this year, including expenses incurred after the harvest.
The cost of agricultural crops is determined by the costs that are attributed to a particular crop. These are the costs of cultivation, harvesting and delivery. The cost of crop production for the current year does not include expenses for unharvested crops or for crops harvested but not threshed.
Subaccount 20-2 “Livestock”
Subaccount 20-2 “Livestock” is intended to systematize expenses for livestock products and the corresponding output. Accounting should be carried out by type of animal and poultry, as well as by individual cost items.
Sometimes separate items are separated from other expenses. For example, for poultry farming such an article could be “The cost of eggs laid for incubation”, for fish farms - “The price of fry that were released into reservoirs”, for sheep farming - “Costs for a shearing station”. The cost of livestock farming also includes the price of dead animals. The exception is natural disasters and epizootics. If the persons responsible for the death are not found, the amounts recorded in account 94 must be attributed to livestock costs. The corresponding article is “Losses from the death of animals and birds.”
The costs of maintaining wet-nurse cows must be taken into account separately from the costs of animals from the dairy herd. Such expenses relate to the maintenance of calves.
The cost of livestock products is determined by the costs of maintaining poultry and animals minus the costs of work in progress. The cost is calculated by individual types of products obtained for each type of animal and is determined by the formula: costs minus the price of by-products (litter, manure, fluff, shedding wool, etc.).
Subaccount 20-3 “Industrial production”
Subaccount 20-3 is used by industrial enterprises to systematize costs for the production of main products, development and preparation of production, management services and maintenance of the production process. The actual cost of production is reflected in the credit of this subaccount. The balance of the subaccount is the cost of work in progress.
Repair organizations that provide services to agricultural companies take into account in this account the costs of repairing equipment, restoring parts, manufacturing products for their own needs and for other companies. The price of the repairs performed is written off from K-ta subaccount 20-3 and recorded in D-t account No. 90. At the same time, an entry is made in K-those of account 90 and in D-th “Other reserves” (96-4).
To record the costs of vehicle fleet maintenance, enterprises create separate accounts. The actual amount of expenses is written off from K-ta 20-3 and attributed to D-t account No. 90.
Subaccount 20-3 is also used to systematize the costs of processing agricultural products, production of small equipment, building materials, extraction of non-metallic materials and logging.
Subaccount 20-4 “Other main production”
This subaccount is used by machine technology stations, agricultural chemical organizations, and inter-farm organizations. Subaccount 20-4 takes into account the costs of cultivating fields, harvesting crops, improving land, measures to protect against weeds and pests, etc.
Agricultural chemical enterprises use a subaccount to account for the costs of transporting chemicals and fertilizers to consumers to warehouses and cargo for repairs and capital construction.
Organizations engaged in repair activities take into account in this subaccount the costs of mechanization and electrification of livestock farms. This is the installation of automatic drinking bowls and milking machines, installation of pipelines and water heating devices, equipping greenhouses, grain warehouses, grain flows, etc. with special mechanisms.
Cost accounting is carried out for individual types of work or for objects. The cost of work performed is written off monthly from the credit of this subaccount. The balance at the end of the month in this subaccount is work in progress. In fact, these are works (both completed and unfinished) that were not accepted by agricultural enterprises.
Business enterprises are created with the aim of obtaining the maximum amount of profit. For this purpose, various types of economic activities are used, for example, wholesale and retail trade in purchased goods, provision of services, and in-house production. Depending on the chosen field of activity, a system for maintaining all types of accounting is selected.
Production
An enterprise engaged in production activities in its chosen area uses a classic tax and accounting system. Management certificates, diagrams and reports are generated in parallel according to a general principle in accordance with the requirements of the owners of the organization. When carrying out production activities, each company forms the cost of manufactured products. Account 20 is used to summarize costs. The presence of auxiliary production or an extensive system of production shops and administrative buildings requires the use of accounts 23, 26, 29, 25 in accounting, which collect all costs related to the cost of the main type of product.
Accounting
Account 20 “Main production” in accounting is intended to reflect all production and general business costs. It is active, synthetic, balance sheet, and the account is closed at the end of the production cycle. As a rule, the 20th account has no balance. The balance sheet may reflect the amount as of a specific date. If an enterprise simultaneously produces several different types of products, then accounting account 20 is maintained for each analytical item separately. The account credit serves to write off the full (production) cost of production. The debit reflects the amount of all expenses for its issue.
Types of production costs
During each reporting period, costs are generated in monetary terms. Account 20 reflects in this case the cost of production. They can be divided into several groups:
- main and invoices;
- complex and single-component;
- indirect and direct;
- one-time and current;
- constants, variables, conditionally variable.
The total cost is calculated by summing up the costing costs, which are posted to account 20 “Main production”. These include:
- Current assets (materials, purchased semi-finished products, raw materials).
- Services of third parties used for the purposes of the main production cycle.
- Payment of workers.
- Contributions to pension and extra-budgetary funds.
- Utilities (electricity, water supply, heat supply).
- Marriage.
- Depreciation of non-current assets.
- Expenses for modernization and introduction of new technologies.
- Other expenses.
- Sales costs (commercial).
Selling costs are not included in the production cost of products, as they are sales costs. Account 20 may not contain this item; according to the provisions of the enterprise’s accounting policy, it may increase account 44 (this is typical for trading companies).
Indirect costs
Accounts 25, 23 and 26 of accounting during any reporting period collect costs for auxiliary, economic and administrative proceedings, which are an integral part of the production of a certain type of product. For the effective functioning of all divisions of the enterprise, it is necessary to timely accrue wages to their employees with appropriate deductions, update and repair non-current funds, and ensure the uninterrupted supply of materials and raw materials.
The maintenance of the administrative and managerial staff of an enterprise is associated with large amounts of costs, which must be covered from the organization’s own and borrowed funds or (which happens much more often) included in the cost of the finished product. All listed costs are summarized in the debit of synthetic 23, 29, 25, 26. After the closing of the reporting period, the monetary expression of the turnover in debit is written off to accounting account 20. In this case, costs can be distributed in proportion to a certain indicator (the amount of materials spent, salary, number of types of manufactured products) or transferred to the cost of one of the manufactured types of products in full. At the beginning of the next reporting period, these accounts should not have a balance; the amount of work in progress is reflected as the balance at the end of the period in the debit of account 20.
Document flow for 20 accounts
Production is an internal process of the enterprise, therefore document flow is based on accounting calculations and certificates, internal regulations of the organization. The release of tangible assets to any department is accompanied by a corresponding invoice, the end of the production cycle is documented in a report, used for inclusion in labor costs. Using an accounting calculation (certificate), the following indicators are included in the cost: distributed, depreciation (depreciation amount) of fixed assets and intangible assets, costs auxiliary production, deferred expenses, losses from defects, returnable waste (subtracted from the cost of products).
Debit account 20
The following entries are reflected in debit 20.
| Dt accounts | CT account | Contents of operation |
| 20 | 10, 15, 11 | Materials written off as main production |
| 20 | 02, 05 | Depreciation was accrued for fixed assets and intangible assets used for main production |
| 20 | 23, 26, 25, 29 | The costs of auxiliary production, experimental work, operational maintenance, and irreparable defects were written off to the OP |
| 20 | 70, 69 | The salaries of employees were accrued, deductions were made from the amount to the relevant funds |
| 20 | 96 | A reserve has been created for OS modernization |
| 20 | 97 | Part of the (estimated) expenses of future periods is written off |
Turnover for the reporting period is summed up and transferred to the cost of manufactured products. After this, account 20 is closed.
Account credit 20
20 loan account contains information on the full (production) cost of manufactured products, semi-finished products, and the cost of services provided. In the process of closing the period, it is transferred in accordance with the accounting policy of the enterprise to accounts 43, 40, 90. Correspondence for credit 20 of account is presented below.
Automated accounting
Organizations that maintain accounting and tax records in a specialized program significantly simplify the process of reporting, interim analysis of activities and can assess the movement of assets at any stage. Most often, various versions of the 1C program are used, which are equipped with unified documents and configured for effective use under the current legislation of the Russian Federation. Also, some versions of the program allow you to conduct parallel accounting and tax management accounting, and generate a number of non-standard reports for full disclosure of information.
Account 20 in "1C" is formed on the basis of the standard documents processed. At the stage of preparation for accounting, it is necessary to configure the program in accordance with the requirements of the enterprise's accounting policy and the applicable taxation systems. Analytical accounting and the account closing algorithm are configured separately. Calculation accounts must be closed in strict sequence; complex expenses are distributed in proportion to the indicator specified in the program. First of all, when closing the period, depreciation of the fixed assets occupied in all production and administrative divisions is calculated, then the costs are transferred to the cost of account 23, 26, 25. 20 account is closed only if all preliminary registers are correctly filled out and the program is optimally configured.
In the process of carrying out activities, an economic entity produces a number of certain production costs, as a result of which it is planned to receive income. These costs involve a time dimension. To account for them, account 20 is used in accounting; here, the amounts of expenses are accumulated and, when the process is completed, are written off to the appropriate account.
Existing standards establish that all costs for the production of products, provision of services or performance of work until the completion of the established process are subject to reflection on account 20.
Here the accumulation of expenses associated with the main activity for which the company was created occurs. Therefore, it is called account 20 “Main production”.
All costs accumulated on this account are called work in progress. This is due to the fact that the invoice reflects them until the moment when they form the cost of the product.
This account is used in almost every enterprise, regardless of the field of activity, with the exception of trade. These can be industrial, agricultural enterprises performing construction and installation work, transport and communications, etc.
If a company creates finished products, then closing account 20 means that it is produced. For works and services, closing the 20th account implies that the entity has provided or fulfilled the obligations stipulated by the agreements.
Attention! For small businesses, a simplified accounting procedure is provided, which implies that all company expenses should be taken into account in account 20. Other accounts (23,25,26) are not applied in this case.
Accounting for information about incurred costs on account 20 is carried out on the basis of supporting documents and is used by management to manage the business entity.
What is included in the account
Account 20 reflects all costs associated with the main activity of the company.
Therefore, the following expenses should be taken into account on the account:
- Material costs are the cost of raw materials, materials, semi-finished products, fuel and others spent on production, that is, what forms the basis of the finished product.
- Costs of services and work of third-party companies involved in the creation of the finished product.
- Remuneration of key personnel with mandatory contributions to extra-budgetary funds.
- Depreciation charges for fixed assets involved in the creation of the finished product.
- Indirect costs that are superimposed on the cost of the finished product - costs of auxiliary production, non-production, factory overhead, sales costs, etc. - they should be reflected on account 20 in the case when the accounts for their accounting are closed at the end of the reporting period.
- Other costs for the production of finished products (taxes, duties, etc.)
The first items relate to direct costs - those that are directly related to production. The cost of the above expenses accumulates while the production process is taking place, and upon its completion they are all written off from account 20 to the cost of the finished product, work, service.
Attention! If the product did not pass technical control and was recognized as a manufacturing defect, the costs of its production previously recorded on account 20 should be written off to the production defect account (usually 28).
Characteristics of account 20 “main production”
Account 20 according to the current one is active, since it reflects the company’s assets. It has a debit balance reflecting the cost of work in progress, that is, costs that have not yet formed the cost of a product or service.
Debit turnover reflects the expenses incurred by a business entity for the production of finished products, provision of services or performance of work. The credit of the account records the cost of production written off for finished products.
The balance at the end of the reporting period is determined by summing the balance at the beginning and the turnover on the debit side of the account and subtracting from it the turnover on the credit side of the account.
Attention! Many business entities, especially those who provide services and work, have a balance of 0 at the end of the reporting period for account 20.
However, this rule does not apply to organizations engaged in production activities. For them, this indicator reflects the products launched into production.
