44 Accounting Account "Sales Expenses"

2024 Author: Howard Calhoun | [email protected]. Last modified: 2023-12-17 10:16

In accounting on balance sheet account 44 ("Sales costs") during the reporting period, information is collected and stored on the costs incurred by the organization. They are associated with the sale of goods, services, works, products. The account is active, calculation.

In industry

When keeping records in the industrial sector, account 44 displays information on the costs of packing and packaging products or products, their delivery to the customer, loading and unloading, deductions for intermediary services, payment for renting warehouse space, for example, in another region, fees to advertising agencies and other similar costs.

In trading

Enterprises that carry out commodity circulation, one way or another, will regularly incur expenses for the sale. In trade organizations, such costs can be: wages, payment for the transportation of goods, rent, advertising, and similar costs.

In agriculture

In organizations involved in the field of agriculture (milk, agricultural crops, leather processing, meat processing, wool), on account 44the following costs are summed up:

• general procurement;
• for poultry and livestock;
• to pay for the rent of receiving and procurement points.

Other expenses may also be included here.

Account structure

The debit of account 44 during the reporting year shows the amount of production costs.

The loan reflects the write-off of these costs. The amount of distribution costs attributable to goods sold during the month is fully or partially written off at the end of the reporting month. This happens depending on the procedure provided for by the accounting policy of the economic entity. Transport costs for partial write-offs are subject to distribution between the goods sold and their balances at the end of the month.

Implementation costs include:

• sub-account 44.1 is used to display the costs incurred in the sale of manufactured products, which are displayed in debit;
• sub-account 44.2 is used mainly by enterprises engaged in trade and catering.

Account 44. Postings

Consider the basic postings:

• Deb.44 / Cr.02 depreciation of fixed assets used in trading activities has been accrued.
• Deb.44 / Cr.70 wages were accrued to trade workers.
• Deb.44 / Cr.60 reflects the cost of ancillary work and third-party intermediary services.
• Deb.44 / Cr.68 reflects the amount of fees andtaxes.
• Deb.44 / Cr.05 amortization of intangible assets has been accrued.
• Deb.44 / Cr.60 transportation costs (VAT not included).
• Deb.19 / Cr.60 reflects the amount of VAT on transport costs.
• Deb.44 / Cr.71 travel expenses of trade workers written off.
• Deb.44 / Cr.94 shortage of goods was written off within the limits of attrition.
• Deb.90.2 / Cr.44 at the end of the month, sales costs are written off.

Calculation of sales expenses (account 44)

The total cost of products sold during the reporting period is formed by adding the cost of sales and the factory cost.

If only part of the goods is sold at the end of the month, then the amount of sales costs is distributed in proportion to their cost between unsold and sold products.

The distribution ratio is the ratio of the amount of sales costs to the cost of shipped products.

Distribution of sales costs. Example

In the reporting month, the organization shipped finished products in the amount of 240 thousand rubles at production cost, and sold - for 170 thousand rubles. At the end of the month, the sale costs amounted to 100 thousand rubles.

Assignment: Distribute the costs of the sale.

• Distribution ratio: 100,000/240,000=0, 4167.
• Sales costs are written off on products sold.

Debit 90.2 Credit 44

170,000 x 0, 4167=70,839.

Calculate the cost of selling forshipped products:

100,000 - 70,839=29,161 or (170,000 - 100,000) x 0, 4167=29,169.

Ad spend

Almost all profit-seeking organizations advertise their products or activities. Today there are many different ways to do this:

• place commercials, ads in the media;
• distribution of catalogs with products, booklets;
• sponsoring holiday events, etc.

Also on account 44, expenses for an advertising campaign are taken into account. The method of writing off such expenses is determined based on the accounting policy of the enterprise:

1. Distributed between sold products and finished products held in stock.
2. Reflected advertising costs in cost of goods sold.

Such costs (advertising costs) may be fully included in the cost of products that have already been sold.

The manufacture or purchase of gifts that the company gives to participants in promotions during their conduct is standardized. For taxation purposes, the amount of such expenses cannot exceed 1% of the organization's (firm's) revenue for the reporting period. The rate applies to all advertising costs that are not included in the list of rateable costs.

Example

LLC sponsored the City Day by paying for the performance of famous performers by transferring five hundred thousand rubles. This is considered an advertisement. Therefore, such contribution is taken into account accordingly. Such expenses are normalized.

LLC earned 47,200 in the reporting period000 rubles (including VAT 7 million 200 thousand rubles). The standard for advertising expenses is 400 thousand rubles: (47,200,000 - 7,200,000) x 1%.

The amount exceeding the standard is: 500,000 - 400,000=100,000 rubles.

The LLC will be able to reduce the taxable income by only 400 thousand rubles.

During the reporting period (or month), sales costs are recorded in the ledger, and then debited to account 90 of subaccount 2 "Sales" (as a result, the cost of sold resources is formed) from credit 44 of the accounting account.