Manufacturing Accounts and Income Statements

Question 1

What is work-in-progress?

Answer 1

Products that have been started but not finished (partly finished products).

Question 2

What are royalties?

Answer 2

A royalty is a fee paid for the right to use an original idea or an asset which has been given a patent or copyright.

Question 3

What purpose does the profit on manufacture serve in the income statement?

Answer 3

It is added onto the gross profit in the income statement.