The total cost has decreased. Assessment of the impact of cost on sales profit. What is prime cost and why is everyone trying to reduce this indicator
Why do so many people still use ephemera. How to turn non-tax expenses into tax expenses
The increase in the cost of goods, works and services directly affects the tax liability of the company. An increase in tax expenses reduces taxable profit. And if transactions subject to VAT are used to increase expenses, the amount of deductions for this tax also grows. Thus, from a tax point of view, it is beneficial for the company that the cost of its products should tend to the selling price or even exceed it.
However, from a financial point of view, it is clear that not any increase in costs is profitable for the company. After all, an organization cannot have a goal to reduce taxes at any cost, even as a result of real financial losses. Therefore, in most cases, it makes no sense to spend a real ruble just to save 20 kopecks in income tax and 18 kopecks in VAT. Therefore, any tax planning measures to artificially increase the cost should not lead to financial losses.
The following types of costs fully satisfy such restrictions:
- fictitious "paper" expenses;
- expenses incurred in the course of intragroup transactions;
- expenses that were actually incurred, but for some reason cannot be fully or partially taken into account in taxation without additional tweaks.
Other types of costs are hardly suitable for tax planning purposes, so there is no point in considering them within the framework of this article.
Fly-bys are still the most popular method of increasing costs
This group of expenses is associated with falsification of documents, the creation and use of organizations that do not carry out real activities (fly-by-night firms). All these actions are illegal and are fraught with not only tax and administrative, but also criminal liability. Therefore, the author in no way recommends using them in practice.
At the same time, these methods are the most primitive. They require a minimum of effort from the performer, as well as professional knowledge and skills. That is why fly-by-night is still so popular in tax planning.
In practice, the organizer of the scheme achieves an increase in cost with the help of one-day trips by embedding such a controlled fictitious organization into his own real economic activity. As a result, this auxiliary company can perform the functions of a supplier of goods, be a reseller (agent, commission agent), create costs by providing fictitious services or performing work for the organizer of the scheme, optimizing its tax obligations.
For example, a fly-by-night takes the position of a supplying (purchasing) organization. That is, through it, all raw materials, materials and goods begin to enter the company. This one-day property is purchased at the market price and sold to the organizer of the scheme at the price he needs to effectively reduce the amount of income tax and VAT. Naturally, winding up the cost of the goods purchased by the organizer of the scheme, the one-day does not pay taxes from the tax base that has formed with it, either in full or in a significant proportion.
Partial payment of taxes allows in practice to postpone exposure of the scheme by the tax authorities, longer and safer to use a fictitious legal entity to minimize taxes. Which, of course, does not make this method of tax planning legal and acceptable (resolutions of the Federal Antimonopoly Service of the West Siberian Federal Antimonopoly Service dated 09.04.13 No. A45-20678 / 2012, Uralsky dated 29.04.13 No. F09-3274 / 13 No. A60-26096 / 12 and dated 29.04 .13 No. Ф09-3216 / 13, Volgo-Vyatsky from 13.02.13 No. A79-5630 / 2011 and Volga districts dated 11.03.13 No. A65-15309 / 2012).
One-day shop purchases goods at a market price, and sells the scheme to the organizer at the price he needs to reduce income tax and VAT
On similar principles, a one-day runner can act as a commission agent for the organizer of the scheme. In this case, an artificial increase in the cost price occurs with the help of a commission, from which the one-day person also does not pay taxes. There is an opinion that this option is safer compared to embedding a fly-by-night in the purchase and sale chain, since in this case the purchase or sale of goods is carried out at market prices.
However, after the cancellation of Article 40 of the Tax Code of the Russian Federation, the determination of the price in accordance with the market is important only in transactions with related companies, and only when a certain turnover limit for the year is exceeded. While the check of the economic feasibility of expenses has not yet been canceled. This means that claims regarding the need for a commission agent or agent to participate in the transaction during a tax audit are quite likely. This is confirmed by the extensive arbitrage practice (Resolutions of the Federal Antimonopoly Service of the Far East of 17.11.08 No. F03-5090 / 2008, of the East Siberian of 18.09.08 No. A19-6738 / 07-33-F02-4498 / 08 and of 20.08.09 No. A33-9313 / 08, of Moscow 18.10.12 No. А40-18642 / 12-20-86 and dated 10.06.09 No. КА-А40 / 3892-09 of the districts, as well as the Fourth Arbitration Court of Appeal dated 09.06.12 No. А78-9016 / 2011).
Ephemera are also often used by unscrupulous tax optimizers to provide bogus services. For example, services related to the organization of the trade process, management, fundraising (loans, borrowings), transport services and forwarding, loading and unloading, storage services, warehouse handling of goods, services for the operation, maintenance and maintenance of premises, merchandising, marketing and advertising.
In practice, other options for artificial creation of costs are used. For example, sublease or license (franchise) payments, payment for a collateral or surety provided, an additional payment for an increased volume or term of the warranty.
As in the case of the services of a reseller (agent, commission agent), the main problem for the organizer of the scheme in this case is to prove the reality of the services provided, the direction of the expenses incurred to generate income and use in activities subject to VAT. In practice, it is far from always possible to do this (resolutions of the Federal Antimonopoly Service of Moscow dated 07.03.13 No. A40-24312 / 12-90-109, West-Siberian dated 23.12.13 No. A70-2439 / 2013 and North-West dated 12.11.13 No. A26 -10206/2011 districts).
In connection with the need to prove the reality of the operation, one of the safest ways to use a fly-by-night is to pay interest on the loan to it. Such a front company, violating the law, does not pay taxes from the interest received, and the organizer of the scheme, taking into account the restrictions established by Article 269 of the Tax Code of the Russian Federation, is included in tax expenses. However, this method has serious disadvantages.
The Presidium of the Supreme Arbitration Court of the Russian Federation noted that in the absence of documents, the amount of the expected tax benefit and costs is determined based on market prices used for similar transactions
First of all, in order to receive a significant amount of money from a one-day loan, this amount must first appear in some way from such an unscrupulous counterparty. That is, the organizer needs to develop another auxiliary monetary scheme. In addition, the loan relationship is not subject to VAT, so the payment of interest will only affect the income tax of the borrower.
Whatever role is assigned to the one-day economic activity optimization company, all financial relationships with it are fictitious. That is, all the costs of paying for goods, works, services received from it are unrealistic. In practice, this means that the funds actually transferred to a one-day day according to some auxiliary schemes that do not entail an additional tax burden are returned to the optimizer's disposal (cashing, loans, contributions to the authorized capital, etc.).
Another option is to pay off the debt not with money, but with some "candy wrappers" - securities that have no real value (for example, bills of the same fly-by-night, unnecessary property, etc.), or no payment goes through at all. That is, the organization has accounts payable on its balance sheet to a shell company, which no one is going to repay. After the law eliminated the requirement to pay for VAT deduction, the latter option was used much more often.
Also, the life of unscrupulous companies was made much easier by the adoption by the Presidium of the Supreme Arbitration Court of the Russian Federation of a landmark resolution dated 03.07.12 No. 2341/12, concerning the company's expenses on transactions with dubious counterparties. Recall that the essence of the resolution is that if there is no documentary evidence of disputed transactions or contains significant defects, the amount of the alleged tax benefit and costs incurred by the taxpayer in calculating corporate income tax should be determined on the basis of market prices applied for similar transactions. Prior to that, when the courts tried similar cases, companies risked losing the entire amount of the disputed expenses.
At the same time, there is one difficulty, since, based on the literal interpretation of the position of the Supreme Arbitration Court of the Russian Federation, this decision is applied only if it is proved that the disputed business transactions were carried out in reality. This position of the Supreme Arbitration Court of the Russian Federation is enshrined in the following decisions (decisions of the FAS Volgo-Vyatsky dated 03.13.13 No. A11-13062 / 2011, East Siberian dated 13.05.13 No. A19-18119 / 2012, Povolzhsky dated 12.04.13 No. A06-3469 / 2012 and North-West of 19.04.13 No. A66-3676 / 2011 districts).
However, as already mentioned, in the case of fly-by-night, this presents certain difficulties. In addition, this approach cannot be used for the purpose of calculating other taxes, in particular VAT. In case of defects in documentary evidence, deductions for this tax will most likely be lost.
Cost can be increased through intra-group optimization of the tax base
More cautious companies try not to use fly-by-night to increase production costs. After all, a reduction in the company's tax liabilities, albeit not so significant, can be achieved using legal methods. For example, you can create a group of companies that includes low-tax subjects. By this term we mean companies that can legally pay tax at a lower rate than a company on general regimewho needs to optimize their tax obligations.
Such companies use special regimes (STS, UTII, ESHN) or have various types of tax benefits and residents in low-tax or offshore jurisdictions. True, managing a group of companies is a much more difficult task than forging documents on behalf of a fly-by-night and requires much higher qualifications of personnel. In addition, when creating a group of companies, it is worth remembering that such a step should have a business purpose that is not related to tax optimization. For example, optimization of business processes, separation of non-core businesses, entry into new markets. Otherwise, the tax authorities have the right to consider the aggregate tax benefit received by the group of companies to be unjustified (Resolution of the Plenum of the Supreme Arbitration Court of the Russian Federation No. 53 of 12.10.06).
However, if splitting up a business has a clear business purpose, no one can consider it a scheme. In the opinion of the Presidium of the Supreme Arbitration Court of the Russian Federation, even if auxiliary companies under a special tax regime are created on the basis of existing business processes, in order to determine possible tax abuses, it is necessary to assess not only the resulting tax savings, but also other factors (decree of 04/09/13 No. 15570/12) ...
In addition, in practice, very often the presence of a group of companies is not advertised. Optimizers try to avoid the slightest sign of interdependence among group members. This allows you to exclude many tax claims in advance and not invent legends about a business goal, however, it seriously reduces both the manageability of the business and control over cash flows.
Some companies increase the cost of goods on the principle of "one pocket" - money is transferred from the pocket of the company to the pocket of its owner, his relatives or other persons indicated by him
In general, low-tax subjects in the group of companies are used in the same way as fly-by-night. That is, the tax base of the company applying common system taxation. But unlike one-day-olds, low-tax subjects pay all legally established taxes. They just do it at lower rates. In addition, the same principle of “one pocket” is used here, when the expenses seem to be actually incurred, but the recipient of the money is a company controlled by the same persons as the payer. That is, the funds, in fact, are shifted from one pocket to another, simultaneously reducing the total tax payments of the entire group.
For example, a friendly company that applies a simplified taxation system with a “income” base becomes a trade and purchasing agent of the company under the general regime. As a result, the entire trade margin goes to such a "simplified" in the form of remuneration and is subject to a single tax at a rate of 6 instead of 20% of income tax. However, such optimization will not affect the VAT, since the agent on the "simplified" system does not pay this tax. This drawback occurs with any embedding of special regimes in the economic activities of the organizer of the scheme, whether it is the provision of any other services or procurement activities. That is why firms using a special regime in a group of companies are often used not to increase the cost of the organizer of the scheme, but to reduce his income. This allows, in addition to transferring the tax base for income tax, to reduce VAT charges.
Another disadvantage of using friendly companies that use STS, UTII or Unified Agricultural Taxation is the legal restrictions set for them on the amount of proceeds, the composition of founders, the amount of property, the number of personnel and types of activities. Companies that use income tax or VAT exemptions are also not free from such disadvantages.
That is why the average and big business often uses offshore or low-tax companies as a subject of a group of companies. As a result, interest paid in their favor on loans, royalties, payments for various kinds of consulting services, subject to certain conditions, can reduce the Russian income tax to almost zero.
Why pay out of net profit if you don't have to
The third group of methods for artificially increasing the cost is, in fact, the transfer of expenses carried out for tax purposes from net profit, in the category of expenses that reduce taxable income. That is, these expenses are really necessary for the company or its founders, but are not aimed at generating income (they do not meet the criteria of clause 1 of article 252 of the Tax Code of the Russian Federation).
Typically, this transfer also allows you to receive a VAT deduction. Despite the fact that the deduction condition is not the economic feasibility of the expense, but the use of goods, work, services in VAT-taxable transactions (clause 2 of Art. 171 of the Tax Code of the Russian Federation), there is a very strong relationship between the validity of the expense and the legality of the deduction of VAT in respect of it.
An example of this cost transfer is the purchase of a personal car, yacht or apartment for the owner of the company. In general, in order to acquire all of this, the owner must first receive dividends from the company. And they are paid after paying income tax and are not included in tax expenses (clause 1 of article 270 of the Tax Code of the Russian Federation). In addition, dividends are taxed with personal income tax at a rate of 9% (clause 4 of article 224 of the Tax Code of the Russian Federation). After that, the individual can already spend the money received from the company on their own consumption.
It is even worse if the company simply pays for the purchase of the property needed by the owner at its own expense. Such expenses cannot be taken into account when taxing profits, since it is almost impossible to prove their economic feasibility. Also doubtful is the right to deduct VAT, while the personal income tax rate will no longer be 9, but 13% (clause 1 of article 224 of the Tax Code of the Russian Federation).
However, if, instead of paying dividends or paying other people's expenses, the company acquires the property necessary for the owner as fixed assets capable of generating income (renting to the same founder), then the expenses in the form of depreciation and VAT deduction will be justified. That is, the company will get rid of income tax, reduce VAT, and an individual will not pay personal income tax.
In this case, the principle of "one pocket" already described above applies. Money is transferred from the pocket of the company to the pocket of its owner, his relatives or other persons indicated by him, which, of course, cannot be considered a real financial loss.
The same principle is used when the cost increases by paying salaries to the owner of the company instead of dividends or to other persons instead of payments from net profit. The disadvantage of this method is that the personal income tax rate is higher than with the payment of dividends - 13 instead of 9% (clauses 1 and 4 of article 224 of the Tax Code of the Russian Federation). In addition, the amount of wages is charged insurance premiums (Clause 1 of Art. 7 and Clause 1 of Art. 8 Federal law dated 24.07.09 No. 212-FZ).
In general, the total tariff is 30% before the maximum base for calculating insurance premiums and 10% after. The maximum amount from January 1, 2014 is 624,000 rubles. (Parts 1, 4 and 5 of Art. 7, Part 1 of Art. 58.2 of the Federal Law of 24.07.09 No. 212-FZ and Decree of the Government of the Russian Federation of 30.11.13 No. 1101). However, if the company applies the general taxation system, then the amount of wages and insurance premiums can be taken into account in the composition of expenses (Article 255, paragraphs 1 and 45 of Article 264 of the Tax Code of the Russian Federation).
Thus, the replacement of dividends (payments from net profit) with a salary will be in the aggregate beneficial to both an individual and a company in the event that the amount of salary significantly exceeds the limit on insurance premiums. Thus, it is possible to achieve that the amount of paid insurance premiums was less than the savings in income tax due to the increase in the cost price.
In practice, this is about 120,000-150,000 rubles. per month. In addition, as an employee, the founder of the company will be able to receive from it various compensations not subject to insurance premiums (clause 3 of article 217 of the Tax Code of the Russian Federation and article 9 of the Federal Law of 24.07.09 No. 212-FZ). And also to receive various property for use for business purposes (car, laptop, tablet, smartphone), spend money on representation needs, study and travel on business at the expense of the company.
- 348.50 KbConclusion: The cost of production for the reporting year amounted to 3,308,427 rubles, and for the previous year - 2,401,542 rubles. With the increase in the cost price, the sales proceeds also increased from 3,056,119 to 4,080,756, this suggests that the increase in the cost price, which occurs due to the increase in production volume, affects the increase in the company's sales revenue.
3. Sources and factors of reducing the cost of production in FSUE "MCC"
Reducing the cost of production is of great importance for increasing the efficiency of social production. It presupposes, first of all, an economical consumption of resources, which testifies not only to the quantitative, but also to the qualitative impact on the economic potential of the country and its future changes.
In a market economy, the role and value of the cost of production increases sharply (Table 6).
Table 3.1. The value of the cost of production for the enterprise.
| From an economic and social point of view, the value of the cost of production for an enterprise is as follows: | an increase in the profit remaining at the disposal of the enterprise, and, consequently, the emergence of the possibility of not only simple, but also extended reproduction; | |
| the emergence of greater opportunities for material incentives for employees and the solution of many social problems of the enterprise collective; | ||
| improving the financial condition of the enterprise and reducing the risk of bankruptcy; | ||
| the possibility of reducing the selling price for its products, which allows to significantly increase the competitiveness of products and increase sales; | ||
| reduction of production costs in joint stock companies, which is a good prerequisite for the payment of dividends and their rate increase. |
Systematic cost reduction is the main means of increasing the profitability of a firm in a market economy, when financial support for unprofitable enterprises is not the rule, but the exception.
Cost reduction factors are quantifiable cost savings opportunities.
The list of technical and economic factors affecting the cost of production is determined on the basis of the selection of permanent causes of changes in the cost of production in the conditions of normal functioning of production. Technical and economic factors can be combined into four groups: an increase in the technical level of production, improvement of management, organization of production and labor, changes in the volume and structure of products, the structure of production and changes in the conditions of management.
In the first group of factors - an increase in the technical level of production - the main ones should be highlighted:
introduction of new and improvement of applied equipment and technology;
expansion of the scale of application of new equipment, technology, modernization and operation of existing equipment;
application of new types and replacement of consumed raw materials, materials, fuel and energy, improving their use;
improving the quality of products, improving their characteristics.
The second group of factors - improving management, organization of production and labor - include:
rationalization of production management;
improving the organization and maintenance of production;
improving the organization of work and the use of working time;
elimination of unnecessary costs and losses (including losses from marriage).
In the third group of factors - changes in the volume and structure of products, the structure of production - the following factors are distinguished:
relative change conditionally fixed costs as a consequence of changes in the volume of production;
relative change in depreciation charges;
changes in the structure of products;
the introduction of new industries (and in associations also the introduction of new enterprises);
development of new enterprises and preparation of production at existing enterprises.
The fourth group of factors - changes in business conditions - includes:
changes in prices for manufactured products;
changes in prices for consumed raw materials, materials, components and semi-finished products, fuel, energy;
change in wages in accordance with the decision of the government;
changes in the conditions of taxation;
assessment of fixed assets and changes in depreciation rates.
In the practice of economic activity of enterprises, sources and factors of cost reduction are distinguished. Sources are understood as quantitatively commensurate savings of all costs incurred by the enterprise in the process of production and sales of products. Sources of cost reduction in various industries have their own characteristics.
Important sources of cost reduction are:
increase in production volume due to more complete use of production capacity, production areas, improvement of technologies, rational organization of repairs The final results of management depend on the level of the material and technical base of the enterprise, the degree of use of its production potential, in particular the level of cost, the volume of products, profitability, profit. If the production capacity of the enterprise is not fully utilized, then this leads to an increase in the share of fixed costs in the total amount and, as a consequence, to an increase in the cost of production;
reduction in the cost of production is ensured primarily by increasing labor productivity. With an increase in labor productivity, labor costs per unit of output decrease, and, consequently, the share of wages in the cost structure also decreases. The success of the struggle to reduce the cost is determined, first of all, by the growth of workers' labor productivity, which, under certain conditions, ensures savings on wages;
cost reduction due to the economical use of raw materials, the use of substitutes, improving the range and structure of products, reducing non-production costs and reducing rejects. Material costs, as you know, occupy a large share in the cost structure, therefore even an insignificant saving of raw materials, materials, fuel and energy in the production of each unit of production as a whole for the enterprise gives a large effect;
reducing production maintenance and management costs also reduces production costs. The size of these costs per unit depends not only on the volume of production, but also on their absolute amount. The lower the total plant costs for the enterprise as a whole, the lower, other conditions, the cost of each product. The reserves for reducing general plant costs consist, first of all, in simplifying and cheapening the management apparatus, in saving on administrative expenses. The structure of general plant costs also includes wages of auxiliary and auxiliary workers. The implementation of measures to mechanize auxiliary and auxiliary work leads to a reduction in the number of workers employed in these works, and, consequently, to savings in general plant costs. At the same time, automation and mechanization of production processes and a reduction in the proportion of manual labor costs in production are of paramount importance.
Conclusion
Production cost , works, services is a cost estimate of natural resources, raw materials, materials, fuel, energy, fixed assets, labor resources, as well as other costs used in the production process of products (performance of work, provision of services).
In the analysis and planning of costs and production costs, two classification signs are most common: economic element and costing articles.
An economic element is understood as an economically homogeneous type of costs for the production and sale of products (works, services), regardless of the purpose, which within the limits of a given enterprise is impossible and impractical to detail in more detail.
A single list of economic elements has been established:
a) material costs;
b) labor costs;
c) deductions for social needs;
d) depreciation of fixed assets;
e) other costs.
Under costing item means a certain type of costs that form the cost of production as a whole or its individual type.
Grouping by costing items makes it possible to determine the cost of products that have completely passed the production cycle and are ready for sale or sold.
Determination of costs associated with the production and sale of a unit
products is called costing, and the document in which they
reflected - by calculation.
The objects of cost calculation are certain types of products, works, services, products (works, services) of a specific division of the main and auxiliary production, products of varying degrees of readiness and all marketable products of the enterprise.
There are various models and methods for calculating costs. By the method of allocating costs - the method of full and partial allocation of costs.
The partial cost allocation model is direct costing, where the cost of production is taken into account and planned only in terms of variable costs. The system of accounting for costs, depending on the utilization of production capacities, involves the inclusion in the prime cost of variables and a part of fixed costs, determined in accordance with the utilization factor of production capacity.
The full cost allocation method is a cost accounting and costing system in which all direct production costs and all indirect costs are included in the cost of production. In this case, direct costs are attributed to specific species products in an economically sound way. The total amount of indirect costs is distributed by product in proportion to the selected distribution factors.
It is possible to single out separately such a cost accounting system as "standard cost", which is a system of cost accounting and costing using standard (standard) costs. It is based on the principle of accounting and control of costs within the established norms and standards and deviations from them.
When calculating the total cost, the following calculation methods are used: direct account method, calculation - analytical, normative, parametric, cost elimination method, coefficient and combined.
Short description
The aim of the course work is to disclose issues related to the analysis of the cost of production and the study of the influence of factors affecting the level of cost, as well as consideration of ways to reduce the cost. As a practical application, the work presents data on the analysis of the cost of production at the enterprise FSUE "GKhK" in Zheleznogorsk. When studying this topic, I used educational and special literature on the theory of economic analysis.
Coursework objectives:
1. Expand the concept and essence of the cost
2. Identify the classification signs of the costs of production and sales of products
3. Consider the methods of calculating the cost of production
4. Examine the planning of costs for the volume of products sold
5. Conduct an analysis of the cost of production by example
The content of the work
Introduction 3
1. The concept and the economic essence of the cost 5
1.1. Classification of production and sales costs 7
1.2. Costing Methods 13
1.3. Factors affecting the reduction of production costs. 21
1.4 The meaning and objectives of analysis and cost management. 23
2. Research of costs for production and sales of products
at FSUE "MCC" 25
3. Sources and factors of reducing the cost of production in FSUE "MCC" 28
Conclusion 31
List of used literature 33
For the convenience of studying the material, we divide the article into topics:
The ability to reduce the selling price of your products, which allows you to significantly increase the competitiveness of products and increase.
Types of production costs
For an enterprise, reliable information about the cost structure is important, since in this case it gets the opportunity to influence it, that is, to manage its costs.
The cost structure is understood as its composition by elements or items and their share in the total cost.
The calculation of the cost price varies under the influence of the following factors :
Depending on what costs are included in the cost of production, distinguish between workshop, production and full cost;
Depending on the degree of product readiness and its implementation - the cost of gross, marketable, shipped and sold products;
Depending on the quantity of products - the cost per unit of products, the total volume of products manufactured;
Depending on the completeness of the inclusion of current costs in the cost of the object of calculation - full cost and limited cost;
Depending on the promptness of the formation of the cost - the actual, or standard, planned cost.
Depending on what costs are included in the cost of production, the following types of products are traditionally distinguished :
Shop cost - includes direct costs and general production costs, characterizes the costs of the shop for the manufacture of products;
Production cost - consists of the shop cost and general expenses; indicates the costs of the enterprise associated with the release of products;
Full cost - production cost increased by the amount of selling (sales) expenses. This metric integrates the total costs associated with both production and sales of products.
According to International standards , only production costs are included in the production cost: direct labor costs, direct material costs and general production costs, and the total cost price consists of production costs, commercial (sales) and administrative (general) costs.
In some cases, when considering costs and determining unit costs, direct labor costs are combined with general operating costs to form an added cost group.
Cost price commercial products represents the cost minus the increase plus the reduction in the cost of semi-finished product balances own production and work in progress.
The cost of goods sold (current cost) is an estimate of the goods sold at the replacement cost, that is, in the sum of the costs required for their production and consumption at the moment. When determining the cost of goods sold, it is necessary to take into account that part of the marketable products of this or the previous period remained in the warehouse, therefore, an increase is deducted from the total cost of goods or a decrease in the cost of the remainder of unsold products is added.
The planned cost includes the maximum allowable for the manufacture of products provided for by the plan for the coming period.
The actual cost price characterizes the amount of funds actually spent on the manufactured products.
In the economic literature, other types of costs are also distinguished, such as individual and weighted average. The individual cost indicates the costs of a particular enterprise for the production of products, and the weighted average - the average costs of the production of any product in the industry.
There is a certain relationship between the individual and average industry costs. The weighted average cost is determined according to the weighted average formula of the individual costs of enterprises in the industry, therefore, its change is the result of changes in the individual cost of production, and, conversely, the average cost of production affects the individual. The ratio of these costs makes it possible to determine the level of labor costs for production at a particular enterprise and is a qualitative indicator of its activities.
The cost structure is in constant flux and is influenced by the following factors :
The specifics (features) of the enterprise. Proceeding from this, labor-intensive enterprises are distinguished (the largest share in the cost is wages); material-intensive (material costs); capital intensive (the largest share of depreciation); energy-intensive (the largest share of fuel and energy in the cost structure);
Acceleration of scientific and technological progress. This factor affects the structure of the cost in many ways, but the main influence is that under its influence the share of living labor in the cost of production decreases, and the share of materialized - increases;
The level of concentration, specialization, cooperation, combination and production;
Geographic location of the enterprise;
Inflation and changes in the interest rate of a bank loan.
The composition of costs included in the cost of production
The role of cost as one of the most important financial economic indicators the activity of the enterprise increases immeasurably in the enterprise management system as it realizes the inevitable need to obtain reliable information about the formation of this indicator, which has various types of groupings and classifications. As you know, the more features of the classification of an object are selected, the higher the degree of its knowledge, and this in turn increases the degree of controllability of the object.
The cost of production reflects the current production costs of the entire volume of products and each of its units.
In the first case, an estimate of production costs is drawn up, in which costs are grouped by elements in order to :
Determine the need for living and materialized labor for the production of the planned volume of products;
Distribute costs by economic content;
Set the proportion of an element in total costs for production.
By grouping costs by elements, you can determine the consumption of raw materials, materials, etc. during the reporting period. Depending on the specific weight of individual elements in the total production costs, labor-intensive, material-intensive, energy-intensive, capital-intensive industries are distinguished, that is, enterprises in which a high proportion of wages, materials, energy and depreciation, respectively, is noted.
When grouping costs by costing items, the composition of costs is determined depending on :
From their direction, i.e. production or service costs;
From the place of origin, i.e. main production or support services.
Expenses are grouped by calculation items when determining the cost of certain types of products, works and services, as well as when assessing the degree of influence of individual elements on its formation and development of a plan of organizational and technical measures to reduce it.
The list of cost items, their composition and methods of distribution by types of products (works, services), as well as the procedure for assessing the balances of work in progress and are determined by industry guidelines on planning, accounting and costing, taking into account the nature and structure of production. At the same time, the grouping of costs by items established for the relevant industry (sub-industry, type of activity) should ensure the selection of those that are directly related to the production of certain types of products and can be directly included in their cost (so-called direct costs).
Individual branches of industry, as well as enterprises, differ significantly among themselves in the proportion of articles. These differences are caused by the industry specificity of production processes, the unequal level of their technical equipment and the originality of the objects of labor. So, processing enterprises of the agro-industrial complex, using a standard nomenclature of cost items for industrial organizations, develop a list of items for their industry.
The main provisions for planning, accounting and calculating the cost of production in industrial organizations were approved by the State Planning Committee of the USSR, the Ministry of Finance of the USSR, The State Committee prices at the Council of Ministers of the USSR and the Central Statistical Office of the USSR in 1970. They define a system of indicators for planning and accounting for production costs, a uniform grouping of costs for all industries by calculation items, a nomenclature of shop and general plant costs and their content.
According to these provisions, the following standard nomenclature of costs for items is established in industrial organizations :
Raw materials and materials minus returnable waste;
Purchased products, semi-finished products and services of a production nature of third-party organizations and enterprises;
Fuel and energy for technological purposes;
Wages of production workers;
Social contributions;
Expenses for preparation and development of production;
General production costs;
General running costs;
Loss from marriage;
Other production costs;
The first five items are directly related to the technological process of manufacturing products and relate to the main costs. The sum of the first seven cost items forms the workshop cost and characterizes the costs of the workshop for the production of products.
General operating costs are the costs of maintaining and managing production. They include the cost of maintaining and operating equipment, shop management costs. In turn, the costs of maintaining and operating equipment include equipment and vehicles, operating costs of equipment in the form of costs of lubricants, cooling and other similar materials, wages of workers servicing the equipment, with deductions for social needs, costs of all types of energy, water , steam, auxiliary production services, equipment repair, intra-plant movement of semi-finished products, products, wear and tear of low-value and wearing out items and other costs associated with the use of equipment.
The shop floor or production management costs include the salary of the shop management apparatus with deductions for social needs, the cost of depreciation of buildings, structures, equipment, their maintenance and repair, ensuring normal working conditions and safety precautions, for overalls and footwear and other similar costs, associated with the management of industrial enterprises.
The sum of the first ten cost items is the production cost, which indicates the costs associated with the release of products, and with the offset of the eleventh item "Commercial expenses" - the full cost of the product.
General business expenses are associated with the function of management, management, which are carried out within the enterprise as a whole.
They include such expenses :
To pay for consulting, information and audit services, bank services;
For training and retraining of personnel, for the recruitment of labor;
Operating costs associated with the maintenance of environmental funds;
Depreciation and;
For the repair of buildings, structures and general production equipment;
Payments for the obligatory property of the enterprise and certain categories of workers, taxes, fees, payments and other obligatory contributions.
Commercial expenses include the costs of containers and packaging, transportation of products, commissions and deductions paid by sales companies in accordance with contracts, advertising costs, and other sales costs (storage, part-time work, sorting).
Analysis of production costs
Such an analysis is important, as it allows you to identify trends in the change in this indicator, fulfillment of the plan by its level, determine the influence of factors on its growth, establish reserves and assess the work of the enterprise in using the possibilities of reducing the cost of production.
In the process of analyzing the cost of production :
The amount of total costs for the reporting period and the rate of its change in comparison with the planned data, in dynamics and with the rate of change in sales volumes are studied;
The structure of the cost, the share of each item in their total value and the rate of change in the amount of costs by item in comparison with the planned data and in dynamics are estimated;
Compares the actual production and total cost for the main types of products and their aggregate with the planned indicators and in dynamics;
The influence of the main factors on the deviation of the indicated indicators is calculated;
The cost of production is estimated by structural units, direct costs are compared with their planned value in conjunction with the volume of output, and general production and general economic costs - with the planned estimate;
The share of non-production costs and trends in its change in comparison with the data of the previous period is determined;
The validity of the choice of the distribution base for different types of costs is established
The objects of analysis of the cost of production are following indicators :
Aggregate costs for the entire volume of production in general and by cost elements;
Costs per ruble of marketable products;
Cost of individual products;
Separate cost items.
The final stage of the cost analysis is the development of recommendations for its reduction as a whole for the enterprise, its structural divisions and for certain types of products.
When analyzing the cost, methods of comparison, modern, correlation, regression and functional cost analysis are used.
At the first stage, in the process of analyzing the cost of production, the total costs for the entire volume of manufactured products are studied, the actual costs of commodity and sold products are calculated, their changes compared to the plan and in dynamics, and the influence of factors on these changes is assessed.
The peculiarity of the cost price analysis is that its formation according to technical and economic factors cannot be directly represented as a product of factors, using information Support in accordance with the current reporting. When studying the cost, the relationship between the factors that form it is not seen to the same extent, and arguing this relationship requires correct logical reasoning. Total costs vary with the volume of output, the level of variable costs and the amount of fixed costs.
In the process of analyzing the structure of the cost of production, the share of each cost item in the cost of production is determined, the rate of their change is estimated for certain period, in order to identify those costs that may become the most significant in the near future.
The ratio of individual economic elements in total costs is characterized by :
The ratio of living and materialized labor;
The share of an individual item or item in the total cost;
The relationship between fixed and variable, basic and overhead, production and commercial, as well as management, direct and indirect costs, etc.
Analysis of costs by elements allows you to study material consumption, energy consumption, labor intensity, capital intensity and establish the impact of technical progress on the cost structure. So, if the share of wages decreases, and the share of depreciation increases, then this indicates an increase in the technical level of the enterprise, an increase in labor productivity. The share of wages is also reduced in the event that the share of purchased components, semi-finished products increases, which indicates an increase in the level of cooperation and specialization.
An important generalizing indicator of the cost of production is the cost per ruble of marketable output. 6n represents the ratio of the total cost of the entire volume of products produced to the value of products manufactured in current prices. Its advantage lies in its versatility, since it can be calculated in any industry and reflects a direct relationship between cost and profit.
The cost per ruble of marketable products directly depends on changes in the cost of production and the cost of manufactured products. In turn, the cost price, as noted above, is influenced by the volume of production, its structure, changes in fixed and variable costs, which can increase or decrease under the influence of changes in the resource intensity of products and prices of consumed resources. The cost of marketable products depends on the volume of output, its structure and product prices.
For a deeper study of the reasons for the change in the cost, accounting estimates for individual types of products are analyzed, the actual level of costs per unit of production is compared with the planned and data from previous years as a whole and for individual cost items.
The calculation of the influence of factors on the change in the cost of production is carried out by the method of chain substitution for each type of product. A more detailed study of the cost of marketable products for each cost item, for which the actual data are compared with planned or data for the past. The identified deviations are the object of factor analysis.
The study of the structure of the cost of individual items includes the following areas of analysis :
Cost composition (according to the specific weight of each item);
Costs by groups depending on their functional role in the production process;
Direct material costs;
Direct labor costs;
Indirect costs.
The consumption of raw materials and materials per unit of production is determined by their quality, the possibility of replacing one type of material with another, changing the recipe of raw materials, equipment, technology and organization of production, qualifications of workers, waste of raw materials.
Average prices for materials are determined by raw material markets, inflation factors, the intra-group structure of material resources, the level of transport and procurement costs, and the quality of raw materials.
At many enterprises there is an excess of recyclable waste of raw materials that can be sold or used for other purposes. Such costs lead to a direct increase in the cost of production and a decrease in its output. As a result of replacing one material with another, not only the amount of materials consumed per unit of production changes, but also their cost.
If the enterprise has purchased components and semi-finished products, then it is determined how profitable the cooperation is for the enterprise. To do this, the purchase price and the cost of own production of this product are compared: if the purchase price is lower than the production cost, then it is more profitable to buy the product or semi-finished product on the side.
The absolute value of direct labor costs depends on the volume of commercial products, its structure and the level of costs for certain types of products. The latter, in turn, are determined by the labor intensity and the level of remuneration per man-hour.
Indirect costs in the cost of production are represented by the costs of maintaining and operating equipment, general production and general economic, as well as commercial expenses... Their analysis is carried out by comparing their values \u200b\u200bper ruble of marketable output in dynamics, as well as with the planned level. Such a comparison allows us to establish how their share in the cost of marketable products has changed in dynamics and in comparison with the plan, and what is the trend - growth or decline. In the course of the subsequent analysis, the reasons for the absolute and relative changes in indirect costs are determined.
The costs of capital, current and preventive repairs depend on the volume of repair work, their complexity, the degree of depreciation of fixed assets, the cost of spare parts and repair materials and their economical use.
The increase (decrease) in expenses for the internal movement of goods is determined by the type of vehicles, the completeness of their use, the degree of implementation production program, the use of funds for the maintenance and operation of rolling stock.
Analytical data are used to analyze shop floor and general business costs. For each article, the absolute and relative deviations from the plan and in dynamics, as well as the reasons for their occurrence, are revealed.
Estimation of deviations of actual costs from the estimate depends on what caused the savings or cost overruns for each expenditure. In some cases, the savings are associated with the failure to fulfill the planned measures to improve working conditions, safety, invention and rationalization, training and retraining of personnel.
During the analysis, non-productive costs are revealed - losses from damage and shortage of raw materials, materials, finished products, payment for downtime due to the fault of the enterprise, the cost of energy and fuel consumed during downtime, additional payments for this time in connection with the use of workers.
Selling expenses include the costs of shipping products to customers (handling, delivery), the cost of containers and packaging materials, advertising, market research, etc. The cost of delivery of goods depends on the distance of transportation, the weight of the transported cargo, transport tariffs for the carriage of goods, the type of vehicles. Loading and unloading costs may change due to changes in the weight of the shipped products and prices for loading and unloading one ton of products.
The costs of containers and packaging materials are influenced by changes in their quantity and cost. The quantity, in turn, is related to the volume of products shipped and the rate of consumption of packaging materials per unit of production. Saving on packaging materials and advertising costs is not always desirable, since they are one of the factors in increasing demand for products. The increase in costs for this expense item is paid off by an increase in sales.
At the conclusion of the analysis of indirect costs, reserves for their possible reduction are calculated and specific recommendations for their development are developed.
Assessment of the impact of the cost of production on the value of the company's profit
Since it is defined as the difference between revenue and the total cost of goods sold, then all the factors that determine the cost have a direct impact on it.
The impact on profit of changes in prices for materials and other resources is calculated separately, and the reasons associated with violation of economic discipline are assessed. In the first case, the calculation is carried out according to accounting data, in the second - using the analysis of deviations formed due to violation of standards, technical conditions, failure to fulfill the plan of measures for labor protection, safety measures, etc.
Based on the results obtained, the total change in the company's profit for the analyzed period is determined, which is the sum of deviations for individual factors.
Reserves for reducing the cost of production
The volume of production at a constant cost of material and labor resources increases only as a result of cost reduction. The development of a plan of organizational and technical measures for the use of internal production reserves is based on the results of the analysis of their sources and factors affecting the technical and economic indicators.
Reducing the cost of products (works, services) is a complex process that requires the workforce of an enterprise to comply with the planned costs of labor, material and energy resources, efficient use of equipment, and search for reserves to save resources.
The main sources of reserves for reducing the cost of products (works, services) are as follows.
First, an increase in the volume of production due to a more complete use of the production capacity of the enterprise. Reserves for increasing production are identified in the process of analyzing the implementation of the production program. With an increase in the volume of activity, only variable costs increase (direct material and labor costs, etc.), while the amount of fixed costs, as a rule, does not change, as a result, the cost price decreases.
A change in the volume and structure of products can lead to a relative decrease in conditionally fixed costs (except for depreciation), a relative decrease, a change in the nomenclature and range of products, and an increase in its quality.
Changes in the nomenclature and assortment of manufactured products is one of the important factors affecting the level of operating costs. With different profitability of certain types of products (in relation to cost), shifts in its composition associated with improving the structure and increasing production efficiency can lead to both a decrease and an increase in production costs.
The influence of changes in the structure of products on the cost price is analyzed by variable costs by items of the calculation of the standard nomenclature. Calculation of the influence of the structure of manufactured products on the cost price is linked to indicators of increasing labor productivity;
Secondly, the reduction of costs for its production occurs due to an increase in the level of labor productivity, economical use of raw materials and materials, electricity, fuel, equipment, reduction of non-productive costs, production defects, etc.
Cost reduction reserves are established for each item of expenditure through specific organizational and technical measures (introduction of new, more advanced equipment and production technology, improvement of labor organization), which will contribute to saving wages, raw materials, materials, energy.
The amount of savings is increased by the percentage of deductions from the wage fund included in the cost of production (unified social tax for the maintenance of children preschool institutions and etc.).
The correct choice and use of the most effective forms and systems of labor remuneration have a significant impact on reducing the cost of production, since the cost is a generalizing indicator characterizing their application.
When business case the effectiveness of the use of a particular system of remuneration is important to determine under what conditions its use provides the greatest reduction in the cost of production. So, with the introduction of incentive systems (piece-rate bonus, time-based bonus, piece-rate incentive, etc.) and bonus systems for employees, as a rule, the share of wages in the cost of production increases. Therefore, the use of such systems is economically beneficial in those conditions when the savings obtained due to conditionally fixed costs significantly exceed additional expense funds for bonuses and an increase in prices and provides a reduction in production costs.
The effective impact of the stimulating system is ensured by observing the following principles :
Clear goal setting (unambiguous definition of the results, the achievement of which is aimed at stimulating the level and composition of costs, which can be reduced by the employee);
Use of sound, reasonable and acceptable measurement and evaluation criteria;
A rigid relationship between incentives and results in terms of volume and time;
Application to the best of tense standards, control over them and the availability of a mechanism for their revision;
Compliance with the sensitivity threshold of the stimulation system.
In modern economic conditions, enterprises are increasingly using bonus systems for employees for reducing certain types of production costs, for example, for saving material resources - raw materials, basic and supporting materials, fuel, energy.
The system of economic incentives for the rational use of all types of material resources must be developed on the basis that involves the practice of solving the problem, focusing not only on the nearest economic results, but also on achievements in the future.
The system of economic incentives for employees for saving material resources should be based on the following principles :
Material interest of all categories of employees in achieving high performance in production and economic activities. At the same time, a close relationship should be observed between the interest of individual employees in achieving high performance with an increase in the efficiency of the enterprise collective as a whole;
Compliance with the outstripping growth rates of labor productivity in comparison with its payment. Bonuses in case of a lag in the growth rate of labor productivity is possible only in exceptional cases, for example, during the reconstruction of production, the development of new highly efficient equipment, economical technological processes, the release of new high-quality products, etc.
Development of a unified methodological framework for creating economic incentive funds.
The cost of the consumed material is reduced as a result of a reduction in the specific consumption of materials per unit of production, which is directly related to a decrease in the standard. Material consumption of products affects dimensions production stocks and the cost of standardized working capitalwhich is of great importance for financial condition enterprises.
As critical area planning of material resources advocates the development of the regulatory framework. The rate of consumption of material resources is understood as the maximum allowable costs of a certain nomenclature of material for the production of a unit of output under specific organizational and technical conditions, taking into account the implementation of the achievements of scientific and technological progress.
The economic rationale for calculating consumption rates is based on standards. To ensure the unity and scientific validity of the norms, the unification of the calculation standards is carried out, while taking into account both the classification of the conditions that determine the consumption of material and the achievements of scientific and technological progress. Standard indicators of material costs are calculated as the ratio of their specific consumption to the value of the technical parameter of the product, they can be power, productivity, etc., which are taken into account when assessing the material consumption of products.
Rationing applies to all types of direct costs, including waste and the inevitable loss of raw materials and materials, since only scientifically grounded cost rates in all areas of industrial consumption provide an increase in the efficiency of using material resources.
The need to use natural and cost rates of consumption of material resources is explained by the fact that replacing a material with a more progressive one does not always provide simultaneous savings, both in terms of consumption and in the cost of used material resources. For example, when replacing a material that has a higher cost, but is less consumed by weight per unit of production, the group weighted average consumption rates in physical terms are reduced, but the same rate in value terms increases. This replacement of materials most often contributes to an increase in material consumption, and, consequently, the cost per unit of production. As a result, production efficiency will fall if the activity is not related to growth. With an increase in quality, losses from the use of more progressive, but more expensive material resources can be eliminated while receiving additional profits by increasing both wholesale prices and production volumes at a constant price. In this case, the price elasticity of demand will operate, which allows for higher revenue, and, consequently, profit, since as a result of its increase due to additional production volume, losses can be compensated.
On the basis of progressive individual consumption rates, it is possible to assess the economic activity of an enterprise for the rational use of material resources, establish a real need for them, and form an economically justified amount of production reserves. Moreover, the entire set of these estimates can be calculated comprehensively and for the entire nomenclature of material resources. Their consumption rates are constantly being adjusted in accordance with changes in production conditions.
The enterprise has the ability to influence the cost of material resources starting from their procurement. Raw materials and materials are included in the cost price at their purchase price, taking into account the cost of transportation, therefore, the correct choice of suppliers of materials affects the cost of production. It is important to ensure the receipt of materials from such suppliers who are located at a short distance from the enterprise, as well as to transport goods using the cheapest mode of transport. When concluding contracts for the supply of material resources, it is necessary to order such materials, which in their size and quality exactly correspond to the planned specification, to strive to use cheaper materials, without reducing at the same time the quality of products.
Thus, the main condition for reducing the cost of raw materials and materials for the production of a unit of production is the improvement of product designs and the improvement of production technology, the use of advanced types of materials, the introduction of technically sound rates of expenditure of material assets.
With the improvement in the use of fixed assets, a decrease in cost occurs as a result :
Improving the reliability and durability of equipment; improving the system of scheduled preventive maintenance;
Centralization and implementation of industrial methods of repair, maintenance and operation of fixed assets.
Savings are calculated as the product of the absolute cost reduction (excluding depreciation) per piece of equipment (or other fixed assets) by the average amount of equipment (or other fixed assets).
Savings reserves are identified on the basis of their factor analysis for each cost item due to a reasonable reduction in the management staff, economical use of funds for business trips, postal and telegraph and office expenses, reduction of losses from damage to materials and finished products, payment for downtime, etc.
Reduced production maintenance and management costs also reduce production costs. The size of these costs per unit of production depends not only on the volume of production, but also on their absolute amount. The lower the amount of shop and general plant costs for the whole enterprise, the lower, other things being equal, the lower the cost of each product.
The reserves for reducing shop floor and general plant costs consist primarily in simplifying and reducing the cost of the management apparatus, in saving on administrative costs. The composition of shop and general plant costs also largely includes the wages of auxiliary and auxiliary workers. The implementation of measures to mechanize auxiliary and ancillary work leads to a reduction in the number of workers employed in these works, and, consequently, to savings in shop and general plant costs. At the same time, automation and mechanization of production processes and a reduction in the proportion of manual labor costs in production are of paramount importance. Automation and mechanization of production processes make it possible to reduce the number of auxiliary and auxiliary workers in industrial production.
The economical use of auxiliary materials used in the operation of the equipment for other economic needs also contributes to the reduction of shop floor and general plant costs.
Significant reserves of cost reduction are contained in the reduction of losses from rejects and other non-productive costs. Study of the causes of marriage. Identification of its culprit makes it possible to carry out measures to eliminate these losses, reduce and most efficiently use production waste.
The scale of identifying and using reserves for reducing the cost of production largely depends on how the work on studying and implementing the experience available at other enterprises is organized.
Continuous technical progress is the decisive condition for cost reduction. The introduction of new technology, comprehensive mechanization and automation of production processes, improvement of technology, introduction of advanced types of materials can significantly reduce the cost of production.
An important reserve for reducing production costs is the expansion of specialization and cooperation. At specialized enterprises with mass flow production, the cost of production is much lower than at enterprises that produce the same products in small quantities. The development of specialization requires the establishment of the most rational cooperative ties between enterprises.
Additional costs for the development of reserves to increase the production of products are calculated separately for each type. To establish their value, it is necessary to multiply the reserve for increasing production by the actual level of variable costs. Similar calculations are carried out for each type of product, and, if necessary, for each organizational and technical measure, which allows a more complete assessment of their effectiveness.
When developing long-term plans to reduce costs, the index method is widely used. In this case, the cost reduction as a result of the use of internal production sources is defined as the sum of the specific weights of the reduction in production costs or costs per ruble of marketable output provided by each source.
Thus, reducing the cost of products (works, services) at the enterprise can be achieved as a result :
The use of resource-saving technology that saves materials and energy, the release of workers;
Strict adherence to technological discipline, leading to the reduction of losses from rejects;
Usage technological equipmentespecially costly in cost effective areas and modes;
Balanced operation of production facilities, leading to a reduction in the cost of fixed assets, work in progress and product inventories;
Development of an optimal strategy for the technical development of the enterprise, ensuring a rational level of costs for creating the technical potential of the enterprise;
Increasing the organizational level of production, entailing a reduction in losses, the duration of the production cycle and, as a result, a decrease in the cost of production and the size of the company's working capital;
Implementation effective systems internal production, contributing to saving all types of resources, improving product quality;
Rationalization of the production management system, which means reducing management costs, increasing its efficiency.
Each direction of reducing the cost of products (works, services) involves a number of activities that together make up specific plans.
Production cost planning
The purpose of planning the cost of products (works, services) is to optimize the current costs of the enterprise, ensuring the necessary growth rates of profit and profitability based on the rational use of financial, labor and material resources.
In the process of developing a plan at cost, the following main tasks are solved :
Analysis of the cost indicators of the production activities of the enterprise as a whole and its individual divisions;
Identification of opportunities and clarification of the size of the reduction in the cost of production in the planned year compared to the previous period;
Drawing up cost estimates for the main types of products;
Identification of unreasonable costs and development of measures to eliminate them;
Determination of the profitability of types of products and production;
Assessment of the impact on the cost, profit, profitability of increasing costs for the development of production of new products;
Creation of a base for the development of wholesale and retail prices;
Development of measures to improve self-supporting relationships between production units of the enterprise.
When drawing up a plan at cost, special attention is paid to identifying reserves for reducing costs, as well as the magnitude and causes of their occurrence, not due to a normal organization production process: excess consumption of raw materials and materials, fuel and energy, loss of working time and surcharges for deviations from normal working conditions and overtime, losses from downtime of machinery and equipment, accidents, rejects, unnecessary costs caused by irrational economic ties in the supply of raw materials and materials, violation of technological and labor discipline, a change in the scope of work on the preparation of production, the development and implementation of new equipment and technology.
When planning the cost of production, it is envisaged to reduce it and achieve, as a result, the optimal level of costs for the production and sale of products and the growth of savings.
Cost planning can be current and prospective. A long-term plan is developed for several years, then, with current planning, these plans are refined based on data from planned estimates and cost estimates for production.
The cost plan in the enterprise consists of the following sections:
Calculation of reducing the cost of production due to the influence of technical and economic factors on it;
Calculation of the cost of types of products (works and services);
Estimating production costs.
Initial data for developing a plan at cost :
The size of the profit, the level of profitability of production or the task to reduce the cost of production;
Indicators of production and sales of products;
Progressive norms and standards of the corresponding section of the tactical plan;
Indicators of the plan of material production;
Price lists;
Data on the use of fixed assets and the amount of depreciation charges;
Indicators of the plan for labor and personnel;
The volume of work on the preparation of production, the development and implementation of new technology, the volume of production of new technology.
When planning the cost of production, the following methods are used :
According to the factorial method, its essence lies in determining the influence of technical and economic factors on the cost of production in the planned year in comparison with the previous one.
When planning costs, this method is applied to :
Ensuring the comparability of the indicators of the plan with similar indicators of other periods;
Implementation of an enlarged calculation of the main technical and economic indicators of production and economic activity at the stage of preparation and comparison of options for proposals in terms of production volumes;
The most complete accounting of the effectiveness of the implementation of measures for the plan to improve production efficiency;
Determination of the participation of individual services, departments and production units in reducing the cost of production and increasing production efficiency, material incentives for this participation, reducibility of indicators for the enterprise, association, industry and the whole region;
Analysis and comparison at various enterprises and associations.
This method takes into account the following factors :
Technical, that is, the introduction of new equipment and technology at the enterprise in the planning period;
Organizational, that is, improving the organization of production and labor at the enterprise in the planning period (deepening specialization, cooperation, improving the organizational structure of enterprise management, etc.);
Changes in the volume, range and range of products;
Inflationary changes in the planning period;
Specific factors that depend on the characteristics of production.
All these factors ultimately affect the volume of production, labor productivity, changes in the norms and prices of material resources.
Estimated method, which involves justifying each cost item using a special cost estimate. The estimate can be drawn up both for individual complex items of expenditure, and as a whole for the volume of gross, marketable and sold products. When planning the cost, separate sections of the plan are used as separate estimates, for example, plans for material and technical support, for labor and personnel, technical and organizational development of the enterprise, in which the costs of the corresponding resources are justified.
The estimated planning method allows you to link separate sections of the tactical plan with each other and coordinate them with the plans of internal production units. On the basis of cost estimates, a set of costs for the production of products as a whole for the enterprise is compiled. In this case, the set of costs for the enterprise is the amount of costs calculated in the estimates of structural units. This method is quite laborious and is used at the stages of the final drawing up of the plan.
Calculation method, with the help of which the value of the cost of producing a unit of products, works, services or their structural elements is justified. When planning the cost price using this method, it is important to correctly determine the costing objects, which are individual products, orders, technological redistributions, brands, grades, articles, etc. In the future, calculations are used in planning the cost of gross, marketable and sold products, cost estimates and a set of costs for the enterprise.
The normative method, in which the level of costs for the production and sale of products, works, services is calculated on the basis of previously drawn up norms and standards. This method is widely used in the preparation of planned cost estimates and cost estimates. Its most important advantage lies in the possibility of separate accounting for deviations from the current norms and their causes, which allows one to judge what factors led to a change in costs, and make timely optimal decisions aimed at improving the economic performance of the enterprise.
When planning the cost of production, these methods are used, as a rule, simultaneously, in a complex, which makes it possible to solve a number of interrelated problems of cost management at the enterprise.
A new approach to planning the cost of production - the use of benchmarking.
Benchmarking comes from the English wordbenchmark - "benchmark", "reference point", "comparison base". The common spelling of the word with a hyphen - benchmarking - is permissible, but not entirely correct, and the use as the identical concept of "benchmarking" is not devoid of economic content, but is formed by consonance with benchmarking and does not form a new concept.
Formally, the benchmarking method was developed in 1972 to assess business performance by the Institute in Cambridge (USA).
Benchmarking is the adoption of the experience of successful companies, "after the weaknesses of the firm have been identified by comparison with other areas of business or competitors." Technologically, benchmarking is a systematic search, assessment, selection and organization of the use of the experience of successful enterprises. It often acts as a basis for developing a company's strategy, since its focus is on the following questions: which company is at the top of the competition? Why is your own company not the best? What needs to be changed or retained in the enterprise to be the best? How do you implement an appropriate strategy to become the best of the best?
In 1992, the United States established the International Benchmarking Center, which is the largest an international organization to study the best business practice.
SpecialistsIVS have developed a Benchmarking Code, the principles of which are :
Legality - no illegal collection of information;
Exchange - “never ask for anything if you cannot provide something in exchange”;
The confidentiality of information must be preserved;
The information can only be used for benchmarking purposes;
Contact type - only designated people can exchange information;
A benchmarking exchange protocol agreement should be made.
As the management of costs and results of the enterprise develops, the significance of the experience of implementing this process in other economic entities of the industry, studied using benchmarking, increases. It promotes openness and improved business performance by providing early warning of lagging behind peers in the industry, ascertaining the level of the enterprise relative to the best in the industry, leading to faster adoption of new approaches with less risk, and reducing the cost of improvement. This system is of particular interest when justifying a cost plan at an enterprise.
In the presence of a sufficiently large amount of data on enterprises in the industry obtained through benchmarking, preference is given to statistical planning methods that allow identifying patterns against the background of chances, constructing multivariate assessment models and, on their basis, obtaining sound conclusions and forecasts.
The main difficulties in the implementation of this technique are associated with the problem of measuring qualitative cost-forming factors, since the described method is applicable to determine costs only taking into account those factors that can be quantified, therefore an important condition is the possibility of formalizing information that cannot be quantified. If the investigated cost-forming factor has two quality levels, then for display in the design models it is measured on a scale of names. In this case, the presence of a feature is coded as one, and its absence is coded as zero. In practical use, the scale of qualitative assessments of one to nine is of particular interest, which makes it possible to sufficiently take into account the degree of difference and has the smallest standard deviation. The implementation of this methodological approach allows taking into account the development trends of enterprises within one industry and objectively assessing the cost-generating factors in a specific market segment and eliminating subjectivity in cost planning.
findings
The cost of production characterizes the costs of the enterprise for the production and sale of products (works, services). Reflecting the processes of production, circulation and distribution, it acts as the main synthetic indicator of the enterprise's activity, determining the results of its economic activity, achievements and available reserves - the most important quality indicator. Its essence as an objective category is determined by a number of principles: connection with the ongoing entrepreneurial activity, the separation of current and one-time costs, the assumption of a temporary certainty of the facts of economic activity and the property isolation of the enterprise.
The calculation of the cost price varies depending on what costs are included in it, on the degree of product readiness and its implementation, on the quantity of products, on the completeness of the inclusion of current costs in the cost of the object of calculation, on the efficiency of its formation.
The list of cost items, their composition and methods of distribution by types of products (works, services), as well as the procedure for assessing the balances of work in progress and finished products are determined by industry guidelines on planning, accounting and costing, taking into account the nature and structure of production.
Analysis of the cost of products (works, services) is important, as it allows you to identify trends in the change in this indicator, fulfillment of the plan by its level, determine the influence of factors on its growth, establish reserves and assess the work of the enterprise in using the possibilities of reducing the cost of production. The following indicators are used as objects for analyzing the cost of production: the total cost of commercial products as a whole and by cost elements, costs per ruble of commercial products, the cost of individual products and individual cost items. The final stage of the cost analysis is the development of recommendations for its reduction as a whole for the enterprise, its structural divisions and for certain types of products.
Reducing the cost of products (works, services) is a complex process that requires compliance with the planned costs of labor, material and energy resources, efficient use of equipment, and the search for reserves for saving resources. The main sources of reserves for reducing the cost of products (works, services) are: an increase in production due to a more complete use of the production capacity of the enterprise and a reduction in costs for its production by increasing the level of labor productivity, economical use of raw materials and materials, electricity, fuel, equipment, reduction waste, manufacturing defects, etc. Each direction of cost reduction involves a number of activities that together make up specific plans.
Cost planning is carried out to optimize the current costs of the enterprise, providing the necessary growth rates of profit and profitability based on the rational use of financial, labor and material resources. When planning the cost of production, the following methods are used: by factor, estimate, standard, as well as the calculation method.
The cost plan at the enterprise usually consists of three sections: calculating the reduction in the cost of production due to the influence of technical and economic factors on it, calculating the cost of types of products and drawing up a cost estimate for production.
A new approach to planning the cost of production - the use of benchmarking, which promotes openness and increases the efficiency of the enterprise through early warning of its lagging behind similar enterprises in the industry, ascertains the level of the enterprise compared with the best in the industry, leads to the rapid implementation of new approaches with less risk and reduces improvement costs. The implementation of this methodological approach allows us to take into account the development trends of enterprises within one industry, objectively assess the cost-generating factors in a specific market segment and eliminate subjectivity in cost planning.
In the activities of the organization, goods are often sold at a price below their cost. Are such transactions allowed by law? What are the tax consequences of such transactions? We will tell you what an accountant should pay attention to when selling products at a loss.
The cost of sales of goods is the current costs of the company for the manufacture of products or services. The method of calculating the indicator varies depending on the option of including costs in the SOE price. When pricing, a method is used to determine the full cost of production or reduced. In the first case, the calculation takes into account absolutely all costs spent in the production of goods - both direct production and indirect commercial, as well as general economic. In the second, all overhead costs are allocated to the SOE cost not directly, but in proportion to the selected base. The latter can be measured by the payroll of production workers, the cost of materials for the manufacture of products, sales indicators, etc.
Depending on the chosen method, the procedure for applying which should be fixed in the accounting policy of the legal entity, an account of the cost of sales is formed - with the attribution of the account. 26 per count. 90 immediately or via n. 20, 29 and 23. In financial analysis, the indicator of the cost of sales of SOEs or services is considered one of the key indicators of financial activity - in the report f. 2, line 2120 reflects information about the amounts se / s for a given period. Used together with the revenue figure on line 2110, it is used to calculate the gross profit or loss of the business. In this case, the accountant should record the cost indicator relative to similar incomes, and in the case when the enterprise has several types of revenue for one period, the number of values \u200b\u200bon lines 2110 and 2120 is split.
Cost classification
In the process of household activities in organizations, the subject of cost accounting is a breakdown of costs by items or elements. The specific gradation depends on the industry, the scale of the business, the type of goods or services produced. The classification by elements is carried out in the context:
- Material costs - includes consumed materials, raw materials, fuel, semi-finished products, energy, components, third-party services, etc.
- Salary costs - this includes settlements with the organization's personnel, including salary, sick leave, benefits, vacation pay, bonuses, compensation payments, supplements and allowances, additional payments, etc.
- Social security contributions - this is where the costs of paying mandatory insurance contributions are collected. These are the amounts to be transferred to the budget and extra-budgetary funds for injuries, pension, medical and social insurance.
- Depreciation charges - include the write-off of depreciation of fixed assets and intangible assets.
- Other costs - all other types of costs that are not included in the main elements are accumulated here. For example, these are interest on credit lines, taxes, various fees, payment of lease payments, advertising costs, consulting services, entertainment expenses, etc.
The classification by costing items consists of indicators:
- Material and raw material costs.
- Deductions for returnable waste.
- Fuel and energy costs.
- Expenses for purchased semi-finished products, components, third-party manufacturing services.
- Payroll expenses for production personnel.
- Insurance expenses for deductions for health insurance, general insurance, compulsory medical insurance, injuries.
- General production costs.
- Sales and marketing costs.
- General business costs.
- The costs of developing and using production facilities.
- Other costs.
Note! If the company participates in the activities of other organizations, the costs associated with this will be recognized as expenses for ordinary activities (paragraph 5 of PBU 10/99). Accordingly, income from participation in other organizations is either an independent type of other income (clause 7 of PBU 9/99) or an integral part of the company's revenue, if such economic activity is related to the main one (clause 5 of PBU 9/99). In the report f. 2 such an indicator is entered on line 2310 (for other income) or on line 2110 (for ordinary earnings).
What is the cost indicator analysis for?
An increase (increase) in the cost of sales or a decrease (decrease) in the value is important when conducting financial analysis and planning to increase production efficiency, profitability and profitability of the organization. How to make calculations? There are many methods - horizontal or vertical analysis by elements (items) of the cost price with factor decomposition of data, study of the structure with the calculation of absolute and relative deviations, determination of the break-even point when breaking down costs into fixed and variable costs, comparison of indicators by periods, normative analysis, etc. ...
The analysis allows you to identify trends in the cost price; find reserves for saving assets, cash, other property; control the implementation of the specified plan; evaluate the quality of the production cycle; check the performance of the Responsibility Centers and staff, including decision makers. When analyzing the production cost, the expenses (costs) of the enterprise are estimated in terms of expenditure in the manufacture of products and the establishment of the optimal price for goods. When analyzing the total cost, it is possible to comprehensively calculate how much the company has spent on the production of a particular type of product, so as not to sell the product at a loss.
In what situations is it possible to sell at reduced prices
Selling products at a cost below the cost is possible if there is an excess of inventory present in your warehouse; with a drop in demand and, as a result, obsolescence of goods; as a result of the expiration of the specified expiration date. In addition, the refusal of the original purchaser to execute the purchase and sale agreement may lead to such compulsory measures; change in the organizational structure of an enterprise during reorganization or liquidation; testing of prototypes of products, etc.
Whatever reasons force the company to sell goods at reduced prices, the transaction is concluded in accordance with the Civil Code. In stat. 454 it is determined that the sale and purchase is made on the basis of the concluded contract, where the specific selling price is listed among the main conditions. At the same time, such a value is determined by the seller at his own discretion, except for exceptional situations regulated by the state (clause 4 of article 421). Accordingly, the company has the right to set any price for products, in particular, to provide discounts on products in accordance with the current marketing policy.
Many accountants are concerned about the question: Are such actions with prices legal? What are the tax consequences for the company? Can tax authorities control such implementation? For the answer, let us turn to the stat. 105.3 of the Tax Code, which deals with controlled transactions. It says here that checking prices for compliance with market prices is possible only when it comes to interdependent persons. If the parties to the transaction do not have signs of dependence, the value of the contract is initially recognized as corresponding to the market value and you are not threatened with any verification.
But there is still a well-known article 40 of the Tax Code, which considers the issues of deviation of contract prices by more than 20% (in the direction of decrease or increase) relative to comparable transactions for a short period. This article is still valid, but only applies to mutual settlements that arose before 01.01.12, that is, transactions concluded before this date. Consequently, prices under contracts of a later period can no longer be recalculated by the tax authorities, since this provision of the Tax Code no longer applies to such contracts.
Consequences of the sale of goods below cost
For ordinary companies, when selling products at a reduced cost, there are no tax consequences. We will have to recalculate taxes (independently or at the request of the Federal Tax Service Inspectorate) for those enterprises that are recognized as dependent according to stat. 105.1. What types of fiscal payments are subject to recalculation? This is income tax and VAT - calculations are made from new market prices.
They are not obliged to recalculate the amounts of the company to the simplified tax system or UTII. And the FTS is not entitled to make claims to organizations on special regimes, since under paragraph 4 of Art. 105.3 A tax audit can only be carried out on MET, VAT, income tax or personal income tax in terms of business income. Simplified tax or imputed tax, paid on fixed income, does not fall under the control of interdependent transactions.
What other implications exist for contracts with prices below cost depends on which product is being sold. For example, if a company has its own inventories that are obsolete and have partially lost the initial market price, a special reserve must be created for the difference at the end of the year to reduce the current value of reserves (paragraph 25 of PBU 5/01). In the balance sheet, such values \u200b\u200bwill be reflected at cost less the amount of the reserve. And with the subsequent sale of objects, the amount of the previously formed reserve (for the sold reserves) is subject to restoration. Typical wiring is as follows:
- D 91.2 K 14 - reflects the creation of a reserve at the expense of financial performance.
- D 14 K 91.2 - the reserved amount has been restored.
Note! It is allowed not to create reserves for reducing the price of goods and materials for those companies that use a simplified accounting methodology, including the formation of accounting (clause 25 PBU 5/01).
How to reflect in accounting the sale of products at reduced prices
The proceeds from the sale of goods are classified as ordinary income (clause 5 of PBU 9/99). The amount taken into account is recognized as equal to the receipt of funds (other property) on account of payment for inventories (other objects) or the generated accounts receivable (clause 6 of PBU 9/99). In this case, it is necessary to take into account all discounts provided on the basis of the contractual conditions.
Typical postings in accounting for sales:
- D 62 K 90 - the proceeds from the sale operation were generated.
- D 90 K 41 - the write-off of goods sold under the contract is reflected.
- D 90 K 68 - the accrual of VAT on the transaction is reflected, it is not required to restore the tax amounts previously accepted for deduction (in the closed clause 3 of article 170 of the Tax Code there is no such basis).
- Д 51 К 62 - funds for products are credited to the seller's account.
- D 99 K 90 - a loss was formed on the sale of goods at a reduced cost. In terms of profit tax, such a loss is accounted for by the accountant in a single amount (clause 2 of article 268).
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The cost of sales of an enterprise is another important indicator profit and loss statement on a par with revenue. The amount of profit ultimately depends on cost accounting. The lower the cost, the higher the company's profit. But the main thing here is not to overdo it and take into account all the costs that must be attributed to the cost price!
The profit calculation formula is quite simple: Profit \u003d Revenue - Cost
I think everyone understands that if Revenue\u003e Costs, then the company is profitable, and if Revenue< Затрат, то такой бизнес убыточен.
And if we can influence the revenue only by increasing sales, then the costs are what entirely depends on us as manufacturers.
The cost price in our case is the cost that we, as a manufacturer, have incurred in order to manufacture the product.
Looking at the income statement, we can see that - Cost \u003d. Therefore, in order to maximize gross profit, we should influence the cost in such a way that it becomes as small as possible.
It should be understood that the cost does not include the cost of selling products. It only takes into account those costs that directly affect the production of goods.
So, for example, if our commodity, which we trade, is gold bars, then the cost price should include all costs that had to be incurred to extract gold and smelt bars from it. That is, this is the cost of geological exploration, and the salaries of miners laying the mine, and the wear and tear of equipment used for the extraction and washing of gold, and the cost of smelting gold bars and their storage. I think it's understandable and it's not worth going further.
The only thing worth noting here is that usually only the wages of workers directly involved in the production process (handymen, foremen, at most heads of shops) are taken into account in the cost price. Administrative personnel (accountant, director, personnel officers, security service, etc.) are taken out of brackets here. Their salary usually falls under the management expenses section of the income statement.
Since the cost of sales of an enterprise is entirely dependent on costs, then an increase in costs in any case will entail a decrease in the company's profits. That is why all managers are very strict with all those items that relate to expenses.
I think all of you, hired workers, have managers whom you turn to regarding the purchase of materials necessary for work (stationery, workwear, office equipment, tools, etc.). Remember how hard you had to knock out for yourself or your subordinates a new computer in the office or a new set of overalls in the shop. As with sweat on your face, you proved the need for acquisition. Remember what influenced the positive decision of the manager? Not your pleas or tantrums (although this sometimes happens), but a detailed and well-reasoned position explaining how this acquisition will increase the quality / quantity of work of the manufactured goods, or at least prevent it from falling.
The manager agreed to incur the costs when you showed him that in return he will receive an increase in sales, and therefore profit! You can take note of this method when talking with your manager in the future.
Now do you understand why the management is so meticulous in analyzing the cost of sales of the enterprise?
By the way, if you are going to buy shares of an enterprise, then you, as the future owner, should also pay attention to the cost of sales.
PS: If you came across this article by accident, but you are interested in the financial statements of companies, then I advise you to start reading with "" and continue with the article "". It will be very informative and helpful.