Many manufacturing companies face the same issue: some products seem profitable, but once every cost is included, they actually lose money. This is why accounting for manufacturing business is so important. It helps you understand the real cost of making each product and quickly identify items that are reducing your profits. What Accounting for Manufacturing Business Covers Manufacturing has more costs than most industries, such as: • raw materials • production labor • machine use and maintenance • factory rent and utilities • waste and defective units • storage and inventory handling If these costs are not tracked properly, product profits can look better than they truly are.
