Based on the relevant provisions of China's accounting system, the following is a detailed interpretation of the main business cost account and its borrowing direction:
The cost of main business is the cost incurred by an enterprise in recurring activities such as selling goods and providing labor services. In China's accounting system, the cost of main business belongs to the profit and loss account, which is used to calculate the actual cost incurred by the enterprise due to the daily activities such as selling goods, providing labor services or transferring the right to use assets.
1.Debit: The debit side of the cost of the main business indicates the increase in costs. When an enterprise sells goods, it needs to carry forward the corresponding costs to the main business cost account, and then debit the "main business cost" and credit the relevant asset class account (such as "inventory goods").
2.Credit: The credit side of the cost of principal business indicates a decrease in costs. At the end of the period, the enterprise needs to transfer the balance of the main business cost to the "current year's profit" account to calculate the current profit and loss, at which time the "current year's profit" is debited and the "main business cost" is credited.
Suppose an enterprise sells a batch of goods, and the cost of the batch of goods is 1 million yuan. At the time of sale, the business needs to carry forward the costs, and the accounting entries are as follows:
Borrow: Cost of main business 1,000,000
Credit: 1,000,000 goods in stock
At the end of the period, assuming that the enterprise has no other business, the balance of the main business cost is 1 million yuan. At this time, the enterprise needs to transfer the balance of the main business cost to the "Profit of the Year" account, and the accounting entries are as follows:
Borrow: 1,000,000 profit for the year
Credit: Cost of sales 1,000,000
1.The cost of main business is an important account for enterprises to calculate the cost of daily operating activities, and it is very important to correctly understand and apply this account to accurately reflect the operating results of enterprises.
2.When accounting for the cost of the main business, attention should be paid to the principle of matching with revenue to ensure that the recognition of costs matches the recognition of revenue.
3.At the end of the period, the balance of the main business cost should be transferred to the "profit of the year" account in a timely manner so as to accurately calculate the profit and loss for the current period.
Through the above analysis and examples, it can be seen that the main business cost plays an important role in China's accounting system and the specific application of its lending direction.