Materials and Source of Income

Subject: Accountancy

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Overview

This note provides you with the brief introduction about office materials and sources of income.
Materials and Source of Income

Materials

Materials refer to all durable and non-materials items required by the office to perform all its activities, accurate and systematic manner. These materials help the manpower to perform official activities efficiently. These provide comfort, reduce tension, monitor, and fatigue. These also help to increase the working efficiency to the staff.

There are two types of materials:

  1. Durable materials: Durable materials are those materials which help to generate regular incomes for an organization. The durable materials are useful for more than one year. These materials are valuable economic resources and will provide a future benefit to the organization. They are treated as fixed assets of the organization. These materials are bought for the purposes of using in the organization and not for reselling. Plant, machinery, furniture, equipment, and vehicles are some of the examples of durable materials.
  2. Non- durable materials: Non- durable materials are those materials which are used for the purpose of manufacturing or selling or operating office and administrative activities. These materials are consumed within one year. The amount spent on these is treated as an expense. These materials help in maintaining incomes. These materials help for the smooth operation of manufacturing, administration and selling activities of the organization. Raw materials, work- in- process, finished goods, stationery and supplies like papers, carbon papers, pen, pencils, inks, stamp pad, staplers, file covers, and registers are some of the examples of non-durable materials.

Sources of Incomes

The revenue which is earned by selling and distributing goods and services on a regular basis is called sources of income. It also includes revenue earned from non-business activities. An income refers to financial benefit or revenue. It is earned against the goods sold or services rendered. Every organization requires regular sources of income. Such incomes are essential to meet regular expenses and to make a surplus. A number of incomes is essential to determine the stability, growth, competitiveness and goodwill of the organization. The main sources of income for the government are income tax, value added tax, interest tax, customs duty, excise duty, donation, etc. The sources of incomes can be classified as follows:

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  1. Regular incomes: Regular incomes are those incomes which are earned by selling goods and rendering services. These incomes are earned continuously throughout the year. Incomes from the sale of goods or rendering services, discount and commission received are the examples of regular incomes for a business organization. Similarly, value added tax, income tax, customs duty and excise duty is the examples of regular incomes for the government.
  2. Other incomes: Other incomes are those incomes which are not earned regularly. These are the incomes other than regular incomes. Rent received, compensation received and interest received are some of the examples of other incomes for a business organization. Similarly, donation, grant, and loans are some of the examples of other incomes for the government.
Things to remember
  • Materials refer to all durable and non-durable materials items required by the office to perform all its activities, accurate and systematic manner. There are durable and non-durable materials.
  • Durable materials are those materials which help to generate regular incomes for an organization.
  • Non- durable materials are those materials which are used for the purpose of manufacturing or selling or operating office and administrative activities.
  • The revenue which is earned by selling and distributing goods and services on a regular basis is called sources of income.There are two sources of income regular and other income sources.
  • Regular incomes are those incomes which are earned by selling goods and rendering services.
  • Other incomes are those incomes which are not earned regularly. These are the incomes other than regular incomes.
  • It includes every relationship which established among the people.
  • There can be more than one community in a society. Community smaller than society.
  • It is a network of social relationships which cannot see or touched.
  • common interests and common objectives are not necessary for society.
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Questions and Answers
  1. Durable materials: Durable materials are those materials which help to generate regular incomes for an organization. The durable materials are useful for more than one year. These materials are valuable economic resources and will provide future benefit to the organization. They are treated as fixed assets of the organization. These materials are bought for the purposes of using in the organization and not for reselling. Plant, machinery, furniture, equipment and vehicles are some of the examples of durable materials.
  2. Non- durable materials: Non- durable materials are those materials which are used for the purpose of manufacturing or selling or operating office and administrative activities. These materials are consumed within one year. The amount spent on these is treated as expense. These materials help in maintaining incomes. These materials help for the smooth operation of manufacturing, administration and selling activities of the organization. Raw materials, work- in- process, finished goods, stationery and supplies like papers, carbon papers, pen, pencils, inks, stamp pad, staplers, file covers and registers are some of the examples of non- durable materials.
  1. Regular incomes: Regular incomes are those incomes which are earned by selling goods and rendering services. These incomes are earned continuously throughout the year. Incomes from sale of goods or rendering services, discount and commission received are the examples of regular incomes for a business organization. Similarly, value added tax, income tax, custom duty and excise duty is the examples of regular incomes for the government.
  2. Other incomes: Other incomes are those incomes which are not earned regularly. These are the incomes other than regular incomes. Rent received, compensation received and interest received are some of the examples of other incomes for a business organization. Similarly, donation, grant and loans are some of the examples of other incomes for the government.

Materials refer to all durable and non-materials items required by the office to perform all its activities, accurate and systematic manner. These materials help the manpower to perform official activities efficiently.

Durable materials are those materials which help to generate regular incomes for an organization. The durable materials are useful for more than one year.

Non- durable materials are those materials which are used for the purpose of manufacturing or selling or operating office and administrative activities. These materials are consumed within one year.

The revenue which is earned by selling and distributing goods and services on regular basis is called sources of income.

Regular incomes are those incomes which are earned by selling goods and rendering services. These incomes are earned continuously throughout the year.

Other incomes are those incomes which are not earned regularly. These are the incomes other than regular incomes. Rent received, compensation received and interest received are some of the examples of other incomes for a business organization.

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