We are basically a trading concern but on and off we have to make customized solutions for our customers.
What we have created is a COGS account called “RAW Material” and make Journal Entries for all the raw materials that we use for the manufacturing also we add the labour cost (if its outside hired help) in the same RAW material account. we maintain an excel file for each project and make a final cost on excel. and then we do a “material receipt” of the item and put the cost from our excel cost.
is this the correct way, do realize our products are customized for each customer so making a manufacturing item would be too cumbersome
thank you for your help