How To Calculate The Cost

Table of contents:

How To Calculate The Cost
How To Calculate The Cost

Video: How To Calculate The Cost

Video: How To Calculate The Cost
Video: How to Calculate the Cost Price Easy Trick 2024, March
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One of the main indicators of the production economy is the cost of production. Understanding what constituent parts make up the cost is necessary for the analysis and planning of the activities of any manufacturing enterprise.

How to calculate the cost
How to calculate the cost

Instructions

Step 1

To calculate the cost of a product means to determine the amount and find out the structure of its production and non-production costs per unit (unit of volume) of the type of product under consideration.

Step 2

The calculation of production costs begins with semi-finished products, materials, raw materials and energy directly used in the technological process.

Step 3

The next type of expenses is the wages of production employees, taking into account the social deductions determined by the norms.

Step 4

When mastering new types or releasing non-serial products, one cannot exclude expenses for preparation of production, for mastering new technologies.

Step 5

A related item in terms of content is non-capital expenditures related to the improvement of technology in order to improve the quality of the product.

Step 6

Further, the costs for the provision of raw materials and materials, for the maintenance of production and maintenance of the basic functions of the enterprise are determined.

Step 7

The next type of costs is the cost of ensuring working conditions, the implementation of safety measures, environmental equipment and environmental measures.

Step 8

The prime cost also includes the costs of maintenance, maintenance and operation of equipment and depreciation charges, taking into account wear and tear and the need to replace tools and equipment in the production process.

Step 9

The actual cost may include other types of direct and indirect (hidden) costs, which can be classified in different ways. The most important types of classification are the classification by cost elements and its complementary classification by calculation items.

Step 10

The prime cost can be calculated as “on average, ie using the average cost indicators for a certain period, referred to the total amount of products of the same type produced during this time, and the calculation of the cost price with item-by-item determination of all types of production costs per unit of output.

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