Job Work effects on ER!

[Guest]

Dear Sir,

We are the manufacture of PP Woven Fabric. but now a day we are also receiving order for Laminated fabric. we don't have laminating facility so that we have sent unlaminated fabric on job work. Process of Job : Unlaminated fabric to Laminated Fabric. we are also sending LD the material used in lamination. Example : Unlaminated Fabric 1000 Kgs. LDPE : 100 Kgs. We will received laminated fabric approx. 1090 Kgs. and excess LDPE 10 Kgs. return. My Query is how to reduce my unlaminated fabric in my stock and how to show the laminated fabric received after job in excise return ER1.

[YAGAY andSUN]

you may book it as process lose.

AI Summary

Process loss treatment for materials sent on job work reduces input stock and governs reporting of processed goods in ER1. Manufacturer sends unlaminated fabric and lamination LDPE to a job worker and receives laminated fabric plus excess LDPE; the advised treatment is to record the conversion as a process operation, adjust input stock by the quantity sent for job work, recognise the finished laminated fabric on receipt, account for any returned surplus input as returned material, and reconcile net variances as process loss for ER1 reporting.