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Cost of raw materials used in corporations

Topics: General: Cost of raw materials used in corporations


Sunday, May 19, 2019 - 03:09 pm Click here to edit this post
Can someone explain to me why we have a cost of raw materials used for corporations in the "profit and loss" section of the page? even though the corporations have already bought those materials in beforehand, as you can clearly see the amount of materials you have in the "Available Materials and Contracted Services" section where you can see how many months in stock you have for each product for that corporation.

I'm just wondering if the corporations are getting charged twice for the products they are buying in, or is it just me not reading this correctly?


Friday, May 24, 2019 - 11:53 pm Click here to edit this post
In short, the answer is no, corporations are not being charged twice.

When your corp buys raw materials/supplies then this will only effect your corp cash levels. It does not come up as a 'cost' in the profit/loss account, not yet anyhow.

Just like IRL, when you buy raw materials you still need to use them to create your finished product, that is what SC is referring to in 'raw materials used', it is not the cost of buying the raw materials, but turning it into your finished product that is being referred to.

Once your finshed products are sold, then this will be recorded as 'products sold' under the profit/loss AND as receipts or 'cash inflows' in the cash statement.

Hope this helps.


Saturday, May 25, 2019 - 08:20 pm Click here to edit this post
So is it an extra cost of turning the raw materials into the finished product then? if it is, it has helped me out quite a lot. Thanks. I was getting a bit confused there.


Sunday, May 26, 2019 - 12:54 am Click here to edit this post
Yes, that is correct.

No problem, happy to help.

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