Advice 1: How to find the total cost

The cost of goods is the sum of all costs, which required the production of another of his party. Depending on how effectively the enterprise optimizes these costs, it will receive more or less profit. It is therefore important in conducting financial analysis to find the full cost of production.
How to find the total cost
Instruction
1
To find the full cost of goods or services, you must consider all of the costs of the enterprise for its production and realisation: PS = PRS + PP.
2
The production cost of goods (PRS) is determined on the basis of the main costs associated directly with production. This material costs, wages, social contributions, depreciation and other overhead costs. Implementation costs (RR), otherwise referred to as commercial and include the cost of packaging, storage, transportation and advertising purposes.
3
Calculate the total material costs sum of cost of raw materials, semi-finished products, components, raw materials, equipment and consumable fuel and energy. In the category of wages will add up the salaries of the main production staff, support staff, serving equipment, etc.
4
Please note payments for intellectual research, discoveries, patents, managerial staff, accountants, Junior staff (cleaners, etc.). Add travel expenses, social benefits, contributions to pension funds, unemployment funds, social insurance, etc.
5
Overhead costs are indirect costs that occur during the production cycle, but not refer to it directly. In other words, they are not dependent on the volume of production, but they are no less important. The payment of interest on long-term and short-term obligations, taxes, rent, lighting and heating of premises, protection, etc.
6
Divide the total cost by the volume of products, and you will find the average cost per unit of product. It is important to conduct a deep analysis of the cost structure, exploring the impact of its changes on the dynamics of prices, which is the main source of profit. There are several statistical methods: classification by balance sheet items, calculation of average and relative indicators (index), graphical method etc.
7
The cost shows how much money the company manages the full cycle of production and sales. This value is the basis for the calculation of the price. The more efficient the company optimizes production, the greater the margin we can do, therefore the more income.

Advice 2: How to find the cost

The cost of goods is the sum of all expenses of the enterprise connected with its production. This value is the minimum price at which costs are fully covered by income. So to find the cost of production is an important, purposeful action, the first step on the road to profits.
How to find the cost
Instruction
1
Cost analysis is one of the most important aspects of economic analysis. It shows in which amount the company has managed the production of a certain amount. When pricing these expenses must be factored in minimum cost. To increase profits and not to raise the price of tradable commodities, you should explore the possibilities of cost reduction without loss of product quality.
2
To find the cost, add up all the costs associated with the production and sale of products. They can be divided into two groups: variable and fixed costs. Please note that the first grow in proportion to the amount of the issue. These include: costs for purchase of raw materials, labor costs, purchase or rental of special equipment, make or buy packaging and personalized packaging. In other words, all the resources, the consumption of which increases depending on extra items.
3
Fixed costs are called so only conditionally, since they are not directly connected with the production, but they can also change over time. These include, for example, payment of rent of the premises/warehouses/offices, amortization, incentive wages and non-production personnel, etc.
4
Distinguish between common, individual and average cost. The total cost is the aggregate cost of all the released output. Individual is the sum of costs spent on production of one unit of the commodity. The average cost is obtained by dividing the total by the number of units of the product. In addition, there are industrial and complete cost price.
5
To find the production cost, consider only the costs associated directly with production, i.e. to obtain the finished products and dispatch it to the warehouse. Further costs for its implementation are referred to as commercial, is the cost related to advertising, total packaging and delivery to the place of future sales. Their summation with the production cost forms the full cost.
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