Secondary sector: most-used accounting accounts

It turns raw materials into finished products. This sector brings in cost accounting: raw materials become work in progress and then finished goods. That is why inventory accounts, machinery, warranties and plant financing set it apart. In construction, customer advances and work in progress play a central role.

Activities included

Manufacturing (textiles, food, chemicals, automotive, electronics)
Construction (buildings, civil works, infrastructure)
Energy industry (power generation and refining)
Crafts (manual or semi-industrial production)
Heavy and light industry

Characteristic accounts of this sector

These 45 accounts of the chart best distinguish this sector. Tap one to open its full page: definition, when it is debited and credited, and common mistakes. Account pages are currently in Spanish and show the English and French names.

45 accounts

1Assets 18

2Liabilities 10

3Equity 1

3106Revaluation surplusRevaluation of land, buildings or machinery.Credit

4Income 5

5Costs 5

6Expenses 6

Typical entry in this sector

Raw material used in production for 6,000.

Account	Debit	Credit
Work in progress	6,000.00
Raw materials inventory		6,000.00
Totals	6,000.00	6,000.00

Accounts this chart does not include

This sector usually also needs accounts that are created as sub-accounts or in a specialized chart:

Construction contracts (contract asset and liability). Works recognized by stage of completion (IFRS 15).
Manufacturing overhead. Usually created as control accounts to allocate it to the product.
Standard cost variances. Differences between standard and actual production cost.

See the 41 accounts common to all sectors

Almost every business, whatever its sector, uses these accounts: cash and banks, customers and suppliers, taxes, basic payroll, capital and equity, and general expenses.