Captive Consumption in Workshop Accounts

Captive Consumption

 

Simply

• Use of goods produced within the same organization for its own use

• Not sold in the open market

• Internal production → internal use

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Example (Indian Railways)

• Workshops like Jamalpur, Kanchrapara, Perambur make railway parts

• These parts are used within the Railway Workshops only

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Specific Example

• Rail Wheel Factory makes wheels and axles

• Supplied to railway units (not sold outside)

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Why important

• Reduces cost

• Ensures quality

• Maintains self-reliance

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One-line memory

• “Produce → Use internally → No sale outside”