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May 27, 2009

Are salaries and wages part of expenses on the income statement?

Salaries and wages of the current accounting period are reported as expenses on a service company’s current income statement.

Salaries and wages of a manufacturer are more complicated. The salaries and wages of people in the administrative and selling functions are reported as expenses on the current income statement. However, the salaries and wages of people in the production departments are assigned to the products manufactured. When the products are sold, their production costs (including the manufacturing salaries and wages) will appear on the income statement as part of the cost of goods sold. The products not sold are reported as inventory on the balance sheet at their production costs (including the manufacturing salaries and wages).

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Comments

5 Responses to “Are salaries and wages part of expenses on the income statement?”

  1. John Eteng on June 3rd, 2009 3:03 pm

    Please, what are Treasury Bills?

  2. qudsia ahmadi on June 11th, 2009 6:20 am

    what is bad debit?

  3. Ikram on June 12th, 2009 11:09 pm

    What is the difference between Applied Factory Overhead and Budgeted Factory Overhead?

  4. pedro on July 13th, 2009 9:02 am

    why is it that wages are not treated as revenue expenditure in a profit and loss account while salaries are treated like that?

  5. Abdalla on July 26th, 2009 1:53 pm

    How quickly understand th difrence between salaries and wages that can’t ne treated as part of an income statement.

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