Accounting treatment for amortization of intangible assets in production workshops

Intangible assets acquired by the production workshop can be included in the cost of the relevant assets when amortizing them. How to handle the accounting for amortizing intangible assets?

How to account for the amortization of intangible assets in the production workshop?

Debit: Production costs

Credit: Accumulated amortization

Production costs include various direct expenditures and manufacturing expenses. Salaries of managers and sales staff are not included in production costs.

Production costs, also called manufacturing costs, refer to the costs of production activities, that is, the costs incurred by an enterprise to produce products. Direct expenses include direct materials, such as raw materials, auxiliary materials, spare parts, etc., and direct wages, such as wages and subsidies of production personnel; manufacturing expenses refer to various expenses incurred by branches and workshops within the enterprise to organize and manage production. Including branch and workshop management personnel wages, depreciation expenses, maintenance expenses, repair expenses and other manufacturing expenses.

Manufacturing costs include:

1. Repair costs

2. Insurance premiums

3. Labor protection fees

5. Machinery and material costs

6. Depreciation of fixed assets

7. Other workshop costs

Accumulated amortization is used to amortize intangible assets. The balance is generally on the credit side, and the credit side registers the accumulated amortization that has been provided. The accumulated amortization account is an asset account and is used to calculate the amortization of intangible assets. Listed under assets on the balance sheet as a deduction from intangible assets. Accumulated amortization only belongs to the adjustment account of intangible assets, and the registration direction is opposite to that of intangible assets.