Calculation of the total cost of production example. Product costing: what is it, calculation formula. Product cost structure

Hello! Many people ask the question: what is the cost of goods or products? For the production of any goods, a number of various resources are spent: natural, energy, land, financial, labor, etc. The sum of all costs incurred will be the cost of production. More this question Let's take a look in this article!

What is the cost of goods

First, let's look at the definition of the cost of goods.

Product cost - this is a monetary assessment of the current costs of the enterprise for the manufacture and sale of goods, as well as the actual cost of labor and financial resources.

In fact, the cost price is an indicator of production and economic activity firm, reflecting the financial costs of the organization for the production of products. The price of the goods directly depends on the cost price. The lower the cost finished products the higher the profitability of the enterprise.

How to determine the cost of goods

Depending on the method of keeping records of expenses, several methods for calculating the cost of goods have been formed: normative, process-by-process, per-order, per-order. In turn, the cost is also divided into several types: gross, commodity and realized.

What is included in the cost of goods

Surely every novice entrepreneur at least once wondered: why do we need a cost price? And it is needed in order to objectively assess the profitability of the enterprise, determine the wholesale and retail price of the goods, and give an objective assessment of the efficiency of spending and using resources.

The cost of goods takes into account many indicators, depending on what exactly needs to be controlled.

The cost of a unit of goods directly depends on the quantity of goods produced or purchased. To understand this, it is enough to consider a simple example:

Let's say you went to the store to buy a pack of tea worth 100 rubles. Then the cost calculation will take the following form:

Suppose you spent 1 hour on a trip (with an estimated cost of a working hour of 100 rubles);
Estimated depreciation of the car was 15 rubles.

Therefore, the cost of goods includes: The cost of a consignment of goods (in this case, packs of tea) + Costs) / Quantity = 215 rubles.

The picture will change significantly if you purchase not one pack of tea, but, let's say, five:

Cost price \u003d ((5 * 100) + 100 + 15) / 5 \u003d 123 rubles.

The example clearly shows that it directly depends on the purchased quantity of products - the more you purchase (or produce), the cheaper each unit costs you. No company is interested in increasing the cost of goods.

Types of production costs

In fact, the cost price is the sum of all costs attributed to the production and release of goods. The cost price can be calculated both for the entire manufactured product, and for a separate commodity unit.

Strictly speaking, there are several types of cost, and, depending on which area of activity the entrepreneur wants to control, the following indicators can be calculated:

Workshop, containing the costs of all departments of the organization aimed at manufacturing products;
Production, including the shop cost, as well as general and target costs;
Full, consisting of production costs and expenses for the sale of products;
General business, which includes expenses that are not directly related to the production process, but are aimed at doing business.

Production cost contains all the resources spent at the production stage, namely:

The cost of purchasing raw materials and basic materials for the manufacture of products;
Costs for fuel and energy supply of production;
Remuneration of employees of the enterprise;
Costs for internal movement of raw materials and supplies;
Maintenance, Maintenance and maintenance of fixed assets of the enterprise;
Depreciation of equipment and fixed assets.

Realized cost implies the costs of the enterprise at the stage of the sale of goods, namely:

The cost of packing / packaging / preservation of products;
The cost of transporting goods to the distributor's warehouse or to the direct buyer;
Product advertising costs.

The total cost of a product is the sum of the cost of production and the cost of sales. Also, this indicator takes into account the cost of purchasing equipment.

Maintenance costs entrepreneurial activity and it is customary to divide it into certain periods during which these costs should pay for themselves. Such costs are added in equal shares to the total costs of production and sales of products and are included in the concept of total cost.

There is also a planned cost, this is the average estimated cost of products manufactured in the planning period (for example, per year). Such prime cost is calculated in the presence of consumption rates for the use of materials, energy resources, equipment, etc.

To determine the cost of one unit of finished products, a concept such as marginal cost is used. This indicator directly depends on the amount of products produced and reflects the efficiency of further expansion of production.

In addition to the cost of production, there is also

The cost structure is classified by cost items and cost elements.

According to the calculation items:

Raw materials, materials, components, semi-finished products, aggregates, etc. necessary for the production of goods;
Fuel and energy resources spent on production;
Depreciation of fixed assets of the enterprise or fixed assets (equipment, tooling, machinery, etc.), the cost of their maintenance and maintenance;
Remuneration of labor to key personnel (salary or tariff);
Additional remuneration to personnel (bonuses, additional payments, allowances paid in accordance with the law);
Contributions to various non-budgetary funds (for example, Pension Fund, social insurance fund, etc.);
Production costs in general (sales costs, transportation costs, payroll for employees of the enterprise, etc.);
Travel expenses (tickets, hotel fees, daily allowances);
Payment for the work of third parties;
The cost of maintaining the administrative apparatus.

By cost elements:

Costs for materials (raw materials, parts, components, fuel and energy resources, overhead costs, etc.);
Employee wage costs (wages of workers, auxiliary workers, for example, maintenance of equipment, wages of engineers, employees, i.e. managers, managers, accountants, etc., junior service personnel);
Contributions to social institutions;
Depreciation of fixed assets of the enterprise;
Other expenses related to advertising, sales, marketing, etc.).

Under general production costs, it is customary to understand the organization's expenses for paying salaries to management staff, payment for security, travel expenses, as well as wages for the management department. This item also includes depreciation and maintenance of buildings and structures, labor protection, training and education of specialists.

The figure shows the approximate cost items of the enterprise for the production of products.

Theory of Constraints

According to this theory, there are certain significant costs that do not depend on the quantity of output. Such costs include loan payments, rent payments and payroll for permanent employees. In the presence of such fixed costs, using the cost of production as an indicator becomes a limiter economic policy enterprises, which can lead to illogical decisions. For example, a product that sells below cost is withdrawn from production, which in turn raises the cost of other manufactured goods.

Methods for calculating the cost of goods

There is no single method for calculating the cost price as such. This indicator can be calculated in absolutely different ways, depending on the type of product, the method and technology of its production, and many other factors.

As a rule, in order to calculate the cost of production, you need to consider the following factors:

The sum of all expenses for the production and sale of products;
Producer costs to operate as an entrepreneur;
Costs associated with the preparation of product documentation.

It is necessary to keep records of the cost of goods directly for a certain production cycle products. In order to determine the price of the goods, you need to make a cost estimate. It is compiled based on the number of products produced (in pieces, meters, tons, etc.). The calculation should reflect absolutely all costs associated with production. (Which articles are included in the calculation is described in the paragraph “Cost structure”).

Method #1

Full addition of expenses to the cost price. The cost price is full and truncated. At full cost, all expenses of the enterprise are taken into account. When truncated - the cost of a unit of production at variable costs. A constant share of overhead costs is attributed to the reduction of profit at the end of the specified period and is not distributed to the goods produced.

With this method of determining the cost, this indicator is influenced by both variables and fixed costs. When added to cost necessary profitability the price of the product is determined.

Method #2

In this method, actual and standard costs are calculated based on the costs incurred by the enterprise. The standard cost allows you to control the cost of raw materials and materials, and, in case of deviation from the norms, take appropriate measures. This method is very labor intensive.

Method #3

The forward method. It is convenient for use in enterprises with serial or mass production, while the products go through several stages of processing.

Method #4

The processor method is mainly used in mining enterprises.

So, to calculate the total cost of production, we use the following algorithm:

Calculate variable costs for the production of one unit of output, taking into account costs;
From general factory costs, we single out exactly those that relate to this type of product.
We summarize all costs that are not directly related to the production process.

The resulting value will be the cost of the finished product.

Since there are several types of cost, then one calculation formula is not enough here.

Production costs:

C \u003d MZ + A + Tr + other expenses

Where C is the cost of expenses;

MZ - material costs of the organization;

A - depreciation deductions;

Tr - waste on wages to employees of the company.

To get the total cost of the finished product, you need to add together all the costs of its production:

Where PS - full cost;

PRS - the production cost of the goods, which is calculated on the basis of production costs (costs for materials and raw materials, depreciation of production assets, social and other deductions);

PP - the cost of selling goods (packaging, storage, transportation, advertising).

The cost of goods sold is calculated by the formula:

Where PS is the total cost,

KR - costs associated with commercial activities enterprises,

OP - the remains of unsold products.

Gross cost is defined as:

C \u003d Production costs - non-manufacturing costs - future costs

If an enterprise produces only one type of product, then its cost and price can be determined using the costing method. In this case, the price of a unit of goods is obtained by dividing the sum of all costs spent on production by the quantity of goods produced. It is worth remembering that all calculations are made for a certain set period.

The calculation and analysis of the cost of goods produced by a large enterprise is very complex and laborious process, requiring certain knowledge, therefore, an accountant solves such problems. It is customary to divide costs into direct and indirect.

The most common way to determine the price of a product is to calculate the cost of production, since this method allows you to calculate the costs of producing a single unit of output.

Cost classification

Depending on what task you want to implement, the costs are classified as follows:

There are two types of costs that are usually added to the cost of the finished product. These are direct costs (these costs are added to the cost of finished products in an exact or single way) and indirect costs (costs added to the subject of calculation according to the methodology established by the enterprise). Indirect include general business, general production and commercial costs;
Depending on the quantity or volume of products produced, the costs are:

Constant (not dependent on the volume of goods produced), indicated per unit of output;
Variables (depending on the volume of production or sales);

There are also costs that are significant for a particular case. Such as, relevant (depending on decisions taken) and irrelevant (not related to decisions).

All of the above indicators of costs and expenses to a large extent affect the formation of the price of goods. But there is another important indicator - tax deductions.

Production costs (cost)- this is the current costs of the company for the production and sale of products, expressed in monetary terms, which are the estimated price base

Calculation unit- this is a unit of a specific product (service) according to costing items (according to costing)

The basis for calculating prices is costing (distribution costs).

It is compiled for the unit of measurement of the quantity of manufactured products adopted taking into account the specifics of production (1 meter, 1 piece, 100 pieces, if produced at the same time). The calculation unit can also be the unit of the leading consumer parameter of the product.

Lists of costing items reflect the features of production.

For modern domestic practice, the following list of costing items can be considered the most characteristic:

raw materials and supplies;
fuel and energy technological goals;
wages of production workers;
payroll of production workers;
overhead costs;
general running costs;
other production expenses;
business expenses.

Items 1-7 are called production costs, as they are directly related to maintenance production process. The amount of production costs is production cost. Article 8 (sales expenses) expenses associated with the sale of products: the cost of packaging, advertising, storage, partly transportation costs. The sum of production and selling expenses is total cost of production. There are direct and indirect costs. Direct costs relate directly

on the cost of a particular product. According to the above list, direct costs are represented by items 1-3, which is typical for most industries. indirect costs are usually associated with the production of all products or several of its types and are indirectly related to the cost of specific products - using coefficients or percentages. Depending on the specifics of production, both direct and indirect costs can vary greatly. For example, in mono-production, direct costs are almost all costs, since the result of production is the release of one product (ship building, aircraft building, etc.). On the contrary, in hardware processes ( chemical industry), where a gamut of other substances is obtained simultaneously from one substance, almost all costs are indirect.

There are also conditionally fixed and conditionally variable costs. conditionally permanent called costs, the volume of which does not change or changes slightly with a change in the volume of output. For the vast majority of industries, general production and general business expenses can be considered as such. conditional variables consider the costs, the volume of which is directly proportional to the change in the volume of output. Usually these are material, fuel and energy costs for technological purposes, labor costs with accruals. The specific list of costs, as we have already said, depends on the specifics of production.

Manufacturer's profit in price - the amount of profit, minus indirect taxes, received by the manufacturer from the sale of a unit of goods.

If the prices for the goods are free, then the amount of this profit depends directly on the pricing strategy of the manufacturer-seller (Chapter 4).

If prices are regulated, then the amount of profit is determined by the rate of return established by the authorities, and with the help of other levers of direct price regulation (Chapter 2).

In modern Russian conditions objects of direct price regulation on federal level are natural gas prices for monopoly associations, electricity tariffs regulated by the Federal Energy Commission Russian Federation, tariffs for the types of transport with the largest freight turnover (primarily tariffs for freight rail transport), the price of vital drugs and services that are most significant from the economic and social standpoints.

The object of direct price regulation by the constituent entities of the Russian Federation and local authorities is a much wider list of goods and services. This list to a decisive extent depends on two factors: the degree of social tension and the possibilities of regional and local budgets. The higher the social tension and the larger the amount of budgetary funds, the greater, other things being equal, the scale of direct price regulation.

In Russian practice, with state regulation of prices and in the overwhelming majority of cases with a system of free prices, the full cost of a unit of goods is taken into account as the basis for using the percentage of profitability when calculating profits.

Example. The cost structure for costing items per 1000 products is as follows:

Raw materials and basic materials - 3000 rubles.
Fuel and electricity for technological purposes - 1500 rubles.
Remuneration of the main production workers - 2000 rubles.
Accruals for wages - 40% of the wages of the main production workers
General production expenses - 10% of the wages of the main production workers.
General business expenses - 20% of the wages of the main production workers.
The cost of transportation and packaging - 5% of the production cost.

It is necessary to determine the level of the manufacturer's price for one product and the amount of profit from the sale of one product, if the profitability acceptable to the manufacturer is 15%.

Calculation

1. We calculate in absolute terms indirect costs, given as a percentage of the wages of the main production workers, per 1000 products:

accruals for wages = 2000 rubles. *40% : 100% = 800 rubles;
overhead costs \u003d 2000 rubles. *10% : 100% = 200 rubles;
general expenses = 2000 rubles. *20% : 100% = 400 RUB

2. We define the production cost as the sum of the costs of articles 1-6.

Production cost of 1000 items = 3000 + 1500 + 2000 + 800 + 200 + 400 = 7900 (rubles).

3. Costs for transportation and packaging = 7900 rubles. 5%: 100% = 395 rubles.

4. Full cost of 1000 products = 7900 rubles. + 395 rub. = 8295 rubles; total cost of one product = 8.3 rubles.

5. Manufacturer's price for one product = 8.3 rubles. + 8.3 rubles. 15%: 100% = 9.5 rubles.

6. Including profit from the sale of one product = 8.3 rubles. 15%: 100% = 1.2 rubles.

Manufacturer price- the price, including the cost and profit of the manufacturer.

Actual sale of goods (services) according to manufacturer's prices(manufacturer's price, factory price) is possible mainly when there are no indirect taxes in the price structure. In modern economic practice, the list of such goods (services) is limited. As a rule, indirect taxes are present in the price structure as direct pricing elements. In absolute prices

most goods (services) included value added tax(VAT).

The structure of prices for a number of goods contains excise. This indirect tax is included in the price of goods that are characterized by inelastic demand, i.e., an increase in the price level as a result of the inclusion of an excise in it does not lead to a decrease in the volume of purchases this product. Thus, the fiscal tax function is implemented - ensuring budget revenues. At the same time, excisable goods should not be essential goods: the introduction of an excise tax in this case would be contrary to the requirements of social policy. In this regard, both in domestic and international practice, primarily alcoholic products and tobacco products are excisable. Commodities such as sugar and matches, characterized by the most a high degree demand inelasticity, are not excisable, since they are included in the list of essential goods.

Along with the main federal taxes (value added tax and excise), prices may include other indirect taxes. For example, before 1997 in Russia, a special tax was included in the price structure. In 1999 sales tax was introduced in almost all regions of the Russian Federation. Later, these indirect taxes were removed.

Let us dwell on the methodology for calculating the value of value added tax in the price as the most common tax.

The price without VAT is the basis for calculating value added tax. VAT rates are set as a percentage of this base.

Example. Manufacturer price level -
9.5 rub. for one product. The value added tax rate is 20%. Then the level of the selling price, i.e., the price exceeding the manufacturer's price by the amount of VAT, will be:

Tsotp \u003d Cizg + VAT \u003d 9.5 rubles. + 9.5 rubles. 20%: 100% = 11.4 rubles.

Elements of the price are also intermediary wholesale markup And trade allowance, if the product is sold through .

Selling price- the price at which the manufacturer sells products outside the enterprise.

The selling price exceeds the manufacturer's price by the amount of indirect taxes.

Rules for accounting and regulation of intermediary services

Intermediary (trade) allowance (discount)- the form of price compensation of the wholesale (trading) intermediary.

Distribution costs- the intermediary's own costs, excluding the costs of the purchased goods.

Both the wholesale intermediary and trade markups, by economic nature, as noted in Chapter 2, are the prices of services of the intermediary and trade organizations, respectively.

Like any price, an intermediary price reward contains three elements:

intermediary costs or distribution costs;
profit;
indirect taxes.

Rice. 9. General price structure in modern Russian conditions. Ip - production costs (cost); П - profit; Hk - indirect taxes included in the price structure; Nposr - wholesale intermediary allowance.

As competition develops, the chain of intermediaries decreases. Currently, in domestic practice, a wide range of consumer goods is sold only with the help of a reseller and directly from the manufacturing plant.

In business practice brokerage fee can be calculated in the form allowances And discounts.

In absolute terms, the intermediary discount and surcharge are the same, since they are calculated as the difference between the price at which the intermediary purchases the goods - purchase price, and the price at which it sells - selling price. The difference between the concepts of "discount" and "surcharge" appears if they are given in percentage terms: the 100% base for calculating the markup is the price at which the intermediary purchases the goods, and the 100% base for calculating the discount is the price at which the intermediary sells this product.

Example.

The intermediary purchases goods at a price of 11.4 rubles. and sells it at a price of 13 rubles.
In absolute terms, discount = surcharge = 13 rubles. - 11.4 rubles. = 1.6 rubles.
The percentage of the allowance is 1.6 rubles. · 100%: 11.4 rubles. = 14%, and the discount percentage is 1.6 rubles. · 100% : 13 rub. = 12.3%.

Under conditions of free prices, intermediary allowances are used when the seller does not experience hard price pressure, i.e., takes the position of a monopolist (leader) in the market. In such a situation, the seller has the opportunity to directly add remuneration for intermediary services.

However, more often intermediary allowances are used as a lever of price regulation by the authorities, when market conditions allow selling goods at a price higher than allowed by the interests of national economic and social policy. So, in Russia for a long time supply and marketing allowances for the most important types of fuel were applied. These allowances were regulated federal authorities authorities. At present, in almost all regions of Russia there are trade allowances for products of increased social importance. These allowances are regulated by local authorities. The scale of their use increased significantly after the 1998 crisis.

Under conditions of free prices, intermediary discounts are used when the seller is forced to calculate his indicators in strict dependence on the prices prevailing in the market. In this case, the calculation of the intermediary's remuneration is based on the principle of "discarding" this remuneration from the level of the market price.

Intermediary discounts are usually provided by manufacturers to sales intermediaries and their permanent representatives.

Along with intermediary discounts and surcharges associated with the price level, a wide

such a form of remuneration for an intermediary as establishing for him percent of the cost of goods sold.

The profit of the intermediary is determined using the percentage of profitability to distribution costs. Distribution costs- the intermediary's own costs (for example, rent for premises, labor costs, packaging and storage of goods).

The costs associated with the purchase of goods are not included in the distribution costs.

Example. Taking into account the conditions of the previous example, let's determine the maximum allowable distribution costs for an intermediary, if the minimum acceptable profitability for him is 15%, and the VAT rate for intermediary services is 20%.

We can represent the absolute value of the intermediary remuneration by an equation, taking for x the maximum allowable distribution costs:

x + x * 0.15 + (x + 0.15x) * 0.2 = 1.6;
x = 1.16 (rubles).

If the sale of goods is accompanied by the services of not one, but several intermediaries, then the percentage of the markup of each subsequent intermediary is calculated on the price of its purchase.

Example. The intermediary sells the goods trade organization. Subject to the above conditions, this sale will be carried out at a price of 13 rubles. (11.4 + 1.6).

Then the retail price at the maximum allowable markup of 20% will be 15.6 rubles. (13 + 0.2 * 13).

Intermediary discounts and surcharges must be distinguished from price discounts And allowances.

The former, as mentioned above, constitute remuneration for intermediary services, therefore their presence is always associated not with one, but with several price stages (their number is directly proportional to the number of intermediaries).

Price discounts and markups are sales promotion tools (Chapter 4). They are used in relation to one price level and are associated with one price stage.

The general structure of the price in modern Russian conditions, taking into account all of the above elements, is shown in fig. 9.

The main objectives of cost planning are to identify and use the available reserves to reduce production costs and increase on-farm savings. The plan (estimate) for the cost of production is drawn up according to the rules that are uniform for all enterprises. The rules contain a list of costs included in the cost of production, and determine the methods for calculating the cost.

The production cost plan includes the following sections:

1. Estimate of costs for the production of products (compiled according to economic elements).

2. Calculation of the cost of all marketable and sold products.

3. Comparison of planned cost estimates for individual products.

4. Cost reduction calculation marketable products according to technical and economic factors.

Common to all industries is the procedure for including in the cost of production only those costs that are directly or indirectly related to the production of products. It is impossible to include in the planned cost of production expenses that are not related to its production, for example, expenses related to servicing the household needs of an enterprise (maintenance of housing and communal services, expenses of other non-industrial facilities, etc.), according to overhaul and construction and installation works, as well as expenses for cultural and community purposes.

Some other expenses are not included in the planned cost, for example, non-productive expenses and losses due to deviations from the established technological process, production defects (losses from defects are planned only in foundry, thermal, vacuum, glass, optical, ceramic and canning industries, as well as in especially complex industries latest technology in the minimum size according to the norms established by the higher organization).

The plan of the enterprise defines the task of reducing the cost of comparable products. It is expressed as a percentage of the reduction in the cost of production in relation to the previous year. The amount of planned savings as a result of reducing the cost of a comparable product can also be indicated.

The cost of production is characterized by indicators expressing:

a) the total cost of all manufactured products and work performed by the enterprise for the planned (reporting) period;

b) costs per unit of work performed, costs per 1 rub. marketable products, the cost of 1 rub. normative net production.

Depending on the amount of included costs, there are cost price:

1) workshop (includes direct costs and overhead costs; characterizes the costs of the workshop for the manufacture of products);

2) production (consists of the workshop cost and general business expenses; indicates the costs of the enterprise associated with the production of products);

3) full (production cost, increased by the amount of commercial and marketing expenses; characterizes the total costs of the enterprise associated with both production and sales of products).

The level of costs is influenced by a number of factors, including changes in consumption rates and prices for materials, growth in labor productivity, changes in production volume, etc.

The economic (imputed) costs of the intended resource used in production are equal to its cost (value) in the most optimal way of its use for the production of goods.

Calculation at the enterprise, regardless of its type of activity, size and form of ownership, organized according to certain principles:

1) scientifically based classification of production costs;

2) establishment of cost accounting objects, calculation objects and calculation units;

3) the choice of the method of distribution of indirect costs and fixing this method in the accounting policy of the enterprise for the financial year;

4) delimitation of costs by periods at the time of their commission without linking them to cash flows;

5) separate accounting for current production costs and for capital investment(Federal Law No. 129-FZ of November 21, 1996 (as amended on November 28, 2011) “On Accounting”);

6) the choice of the method of cost accounting and calculation.

The choice by the enterprise of the method of accounting for production costs is carried out independently and depends on a number of factors: industry affiliation, size, technology used, product range.

The classification of methods for accounting for production costs and calculating the cost of production involves:

1) completeness of cost accounting (full and partial cost, cost for variable costs);

2) objectivity of accounting, cost control (accounting for actual and standard cost, the "standard-cost" system);

3) object of cost accounting (by-process, by-order and by-order methods).

The cost of a unit of production is determined by dividing the total costs for the reporting month by the number of products produced during this period and is calculated by the formula:

C \u003d W / X,

where C is the cost of a unit of production, rub.;

Z - total costs for the reporting period, rub.;

X- the number of products produced during the reporting period in physical terms (pieces, tons, m, etc.).

The calculation of the unit cost of production is carried out in three stages:

1) the production cost of all manufactured products is calculated, then the production cost of a unit of production is determined by dividing all production costs by the number of manufactured products;

2) the amount of administrative and commercial expenses is divided by the number of products sold during the reporting month;

3) the indicators calculated in the first two stages are summarized.

However, at enterprises that produce one type of product (in the absence of semi-finished products own production) and have a certain amount of finished products not sold to the buyer, the method of simple two-stage costing is applied.

Production cost method simple two-step costing is calculated using the following formula:

C \u003d (Z pr / X pr) + (Z control / X prod),

where C is the total cost of production, rub.;

З pr - total production costs of the reporting period, rub.;

X pr - quantity units of production produced in reporting period, PC.;

X prod - the number of units of products sold in the reporting period, pcs.

If the production process consists of several stages (repartitions), at the exit of which there is an intermediate warehouse of semi-finished products, and from repartition to repartition, the stocks of semi-finished products change, then the method is used multi-step simple costing. The calculation of the unit cost of production is carried out according to the following formula:

C \u003d (Z pr 1 / X 1) + (Z pr 2 / X 2) + ... + (Z control / X prod),

where C is the total cost of a unit of production, rub.;

З pr 1, З pr 2 - total production costs of each redistribution, rub.;

Z control - administrative and commercial expenses of the reporting period, rub.;

X I , X 2 - the number of semi-finished products manufactured in the reporting period by each redistribution, pieces;

X prod - the number of units sold in the reporting period, pcs.

The object of calculation is the product of each completed process, including those processes in which several products are simultaneously obtained. As a result of the successive passage of the source material through all stages, finished products are obtained; at the exit from the last section there is not a semi-finished product, but a finished product. In industry, two options for accounting for production costs are used: semi-finished and non-semi-finished.

The costs of manufacturing semi-finished products, parts and assemblies are accounted for by workshops in the context of expense items. The added costs are reflected for each workshop (processing) separately, and the cost of raw materials is included in the cost of production of only the first processing. With this option of accounting for production costs, the cost of a unit of finished products is formed by summing up the costs of workshops (redistributions), taking into account the share of their participation in the manufacturing process.

The non-semi-finished accounting method is simpler and less labor-intensive than the semi-finished one. Its main advantage is the absence of conditional calculations that decipher the costs of previous workshops and redistributions, which increases the accuracy of the calculation.

Note! The advantage of the semi-finished accounting method is the availability of accounting information on the cost of semi-finished products at the output of each stage (it is necessary when selling them). This does not require a simultaneous inventory of work in progress throughout the enterprise.

The costs of the enterprise associated with the production and sale of products are conventionally divided into two large groups: direct and indirect.

to direct costs include direct material costs and direct labor costs. They are called direct because they can be directly attributed to the cost carrier. Special techniques are required to allocate indirect costs to a product.

The first element of direct costs is the actual consumption of materials for the reporting period, which is determined by the formula:

R f \u003d O np + P - V - O kp,

where R f - the actual consumption of materials for the reporting period, rub.;

About np - the balance of materials at the beginning of the reporting period, rub.;

P - documented receipt of materials during the reporting period, rub.;

B - internal movement of material during the reporting period (return to the warehouse, transfer to other shops, etc.);

About kp - the balance of materials at the end of the reporting period, determined according to the inventory, rub.

The actual consumption of materials for each product is determined by distributing them in proportion to the standard consumption.

The second element of direct costs is the wages of the main production workers with the corresponding accruals on it.

To calculate the wages of employees on time system wages, data from timesheets are used. In the conditions of a piecework form of remuneration, various systems for accounting for the output of pieceworkers can be used. For example, the system of operational accounting for production provides for the acceptance, calculation and recording of information about the production of a worker (team) in primary documents by the controller and foreman after each operation is completed.

In the conditions of small-scale and individual production, the main primary document for accounting for production is a piece work order. It reflects the task, its implementation, the category of work, the time worked, the rate and the amount of earnings.

In serial production, route sheets or maps are primary documents. They record the launch into production and processing of a batch of blanks in accordance with the established technological process. When transferring a batch of parts from shop to shop, a route sheet is also transferred with them.

The output of workers is defined as the balance of parts or blanks at the beginning of the shift, increased by the number of parts transferred to workplace per shift, minus the balance of unworked or unassembled parts at the end of the shift. The output of each worker calculated in this way is drawn up in reports or records of output. After multiplying the piece rate by the actually achieved output, the amount of the accrued wages of the worker-pieceworker is obtained.

In practice, the following bases are used to allocate production overheads among cost carriers:

1) the time of work of production workers (man-hours);

2) wages of production workers;

3) equipment operation time (machine-hours);

4) direct costs;

5) cost of basic materials;

6) the volume of manufactured products;

7) distribution in proportion to estimated (normative) rates.

The most important principle of choosing the method of distribution of overhead costs is the maximum approximation of the results of the distribution to the actual cost of a given type of product.

One of the alternatives to the traditional domestic approach to costing is the approach when, according to cost carriers, it is planned and taken into account incomplete, limited cost. This prime cost may include only direct costs and be calculated on the basis of only production costs, that is, costs directly related to the production of products (works, services), even if they are indirect. In each case, the completeness of the inclusion of costs in the cost is different. However, common to this approach is that some types of costs related to the production and sale of products are not included in the calculation, but are reimbursed by the total amount from the proceeds.

One of the modifications of this system is the direct-cost system. Its essence lies in the fact that the cost is taken into account and planned only in terms of variable costs, that is, only variable costs are distributed among cost carriers. The rest of the costs (fixed costs) are collected in a separate account, they are not included in the calculation and are periodically written off to financial results, that is, they are taken into account when calculating profits and losses for the reporting period. Inventories are also estimated at variable costs - the balance of finished products in warehouses and work in progress.

Example 1

The initial data for costing are presented in the table.

Example of costing
No. p / p	Cost item	Amount, rub.
	Basic materials, including purchased products	direct costs
	Transport and procurement costs
	Fuel, energy (technological)
	Basic salary	standard hour cost
	Additional salary
	Contributions to funds	34.2% of (clause 4 + clause 5)
	Costs for preparation and development of production	30% of (clause 4 + clause 5)
	Equipment maintenance costs and tool wear	40% of (clause 4 + clause 5)
	shop expenses	30% of (clause 4 + clause 5)
	Factory overhead	10% off (clause 4 + clause 5)
	Production cost	item 1 + item 2 + item 3 + item 4 + item 5 + item 6 + item 7 + item 8 + item 9 + item 10
	non-manufacturing expenses	15% of item 11
	Total production cost
	Planned savings	10% of clause 13
	Wholesale price	item 13 + item 14 + VAT 18%

The normative method of cost accounting and costing is characterized by the fact that the enterprise prepares a preliminary standard cost estimate for each type of product, that is, a cost estimate calculated according to the norms of consumption of materials and labor costs in force at the beginning of the month.

Standard costing is used to determine the actual cost of production, evaluate defects in production and the size of work in progress. All changes in the current norms are reflected within a month in the normative calculations. Norms can change, for example, decrease, as production is mastered and the use of material and labor resources improves.

Accounting is organized in such a way that all current costs are divided into consumption according to the norms and deviations from the norms.

The system of standard (standard) costs is used to evaluate the activities of individual employees and the organization as a whole, prepare budgets and forecasts, and help to make a decision on setting real prices.

Indirect Cost Allocation Scheme as follows:

1. Selecting an object to which indirect costs are allocated (product, product group, order).

2. The choice of the distribution base for this type of indirect costs - the type of indicator using which the distribution of costs is made (labor costs, basic materials occupied production area and so on.).

3. Calculation of the distribution coefficient (rate) by dividing the value of the distributed indirect costs by the value of the selected distribution base.

4. Determining the amount of indirect costs for each object by multiplying the calculated value (rate) of cost distribution by the corresponding this object the value of the distribution base.

Example 2

The overhead costs of the enterprise, subject to distribution over several orders that were completed in a month, are 81,720 rubles.

The direct costs taken into account when fulfilling the order were:

1) material costs - 30,000 rubles;

2) the cost of wages for the main production workers - 40,000 rubles.

The distribution base is the cost of wages for the main production workers (including payroll taxes). In general, for the organization for the same period, the base amounted to 54,480 rubles. (40,000 × 36.2%).

The distribution rate (C) will be determined by the following formula:

C \u003d OPV / Z,

where OPV - overhead costs;

Z - the wages of the main production workers.

In this case, C \u003d 81,720 / 54,480 \u003d 1.5 (or 150%).

Based on the distribution rate, overhead costs are charged for specific orders (products, products). OPV \u003d W × C \u003d 40,000 × 1.5 \u003d 60,000 rubles.

After that, the sum of direct and general production costs is determined (as the production cost of order fulfillment): 30,000 + 40,000 + 60,000 = 130,000 rubles.

But such a distribution scheme is not always linked to the process of organizing production, and in this case more complex calculation methods are used. For example, overhead costs are first divided by place of origin (workshops, departments, etc.), and then only by orders.

However, when choosing a distribution base, it is necessary to observe the principle of proportionality in order to maintain a fair and rational distribution of costs among orders (products, etc.), namely: the value of the selected distribution base and the value of the distributed costs must be in direct proportion to each other.

For example, the larger the allocation base, the larger the cost to be distributed.

The difficulty lies in the fact that in practice it is almost impossible to find such a base for heterogeneous indirect costs. In order to increase the validity of the distribution for various kinds overhead costs, you can apply different allocation bases, for example, these:

1) the labor costs of the AUP are distributed proportionally wages ODA;

2) the costs of repair and maintenance of general production buildings are distributed in proportion to the area of the production unit;

3) the costs of operation and maintenance of equipment are distributed in proportion to the time of operation and the cost of this equipment;

4) the costs of storing materials are distributed in proportion to the cost of materials;

5) the commercial expenses of the enterprise are distributed in proportion to the proceeds from the sale for certain period time.

Example 3

Using the data from the previous example, but adding overhead costs:

1) labor costs of the AUP - 50,000 rubles;

2) rent for industrial premises and utility bills - 105,000 rubles;

3) commercial expenses of the enterprise - 35,000 rubles.

The area of production premises is 60% of all production areas.

The share of revenue from the order is 30% of the total revenue of the entire enterprise for the period under review. The share of labor costs for this order is 35% of the total labor costs of production workers of the enterprise.

The cost of the order under these conditions will be the following allocated amounts:

1) labor costs of AUP - 17,500 rubles. (50,000 × 35%);

2) rent expenses and public utilities— 63,000 rubles. (105,000 × 60%);

3) commercial expenses - 10,500 rubles. (35,000 × 30%).

Let's determine the sum of direct and general production costs (production cost of order fulfillment): 30,000 + 40,000 + 17,500 + 63,000 + 10,500 = 161,000 rubles.

In this case, the result obtained is more accurate than in example 2, but the process of its determination is more laborious.

Process costing method it is mainly used in the production of homogeneous products or where for a long time the products are processed through several production stages, which are called redistributions (in the service sector (at enterprises Catering) and in enterprises using a self-service system). The process-by-process method of costing allows you to group all production costs by departments (by production processes).

Example 4

Furniture assembly consists of two stages (repartitions), each of which is processed. Labor costs for production personnel (Z) are: Z 1 \u003d 20,000 rubles; Z 2 \u003d 31,000 rubles.

Materials are included in production, respectively: M 1 \u003d 80,000 rubles; M 2 \u003d 62,000 rubles.

At the end of the first stage, 200 pieces are formed. blanks, of which only 150 pieces go for further processing. (the remaining 50 pieces are used in the next reporting period). At the end of the second stage, the output is 140 pieces. furniture.

Let's determine the cost of furniture after each stage of the production process and the cost of 1 piece. furniture after the second stage of processing.

After the first stage, the cost of 200 pcs. blanks will amount to 100,000 rubles. (80,000 + 20,000).

Cost of 1 pc. blanks - 500 rubles. (100,000 / 200).

Cost price 150 pcs. furniture that goes into further processing (Z I) will amount to 75,000 rubles. (500×150).

Let's determine the costs for 150 pcs. furniture after the second stage: M 2 + Z 2 + Z I \u003d 62,000 + 31,000 + 75,000 \u003d 168,000 rubles.

Cost of 1 pc. furniture will be 1200 rubles. (168,000 / 140).

The example reflects only the production cost, without including the costs of APM and selling expenses.

When two or more products are produced simultaneously in the course of a technological process, the elimination method or the distribution method is used for costing. It is problematic to allocate the costs of the first stage of processing between products at subsequent stages.

When calculating elimination method one of the products is chosen as the main one, the rest are recognized as by-products. Then only the main product is calculated, and from the sum of the costs integrated production the cost of by-products is deducted. As a result, the resulting difference is divided by the amount of the main product received.

The cost of by-products is determined by the following indicators:

1) the market value of the by-products obtained at the separation point;

2) the possible value of the sale of by-products at the point of separation;

3) standard cost of by-products;

4) indicators of by-products in physical terms (product units), etc.

Example 5

Production consists of two stages (repartitions). After the first stage, the production process is divided into two products, each of which is independently processed. At all stages, processing costs are incurred, consisting of the cost of wages for production personnel: Z 1 \u003d 20,000 rubles; Z 2-1 \u003d 15,000 rubles; Z 2-2 \u003d 25,000 rubles.

The main materials are included in the production at the first stage, additional materials are used at the second production stage for each product: M 1 = 80,000 rubles; M 2-1 = 30,000 rubles; M 2-2 = 45,000 rubles.

After the first stage, 200 pieces are formed. blanks of option 1 and 30 pcs. blanks of option 2. All blanks received after the first stage go for further processing. By peer review market price furniture option 1 at the point of separation is 600 rubles / piece, furniture option 2 - 40 rubles / piece.

After the second stage, 145 pieces are formed. furniture option 1 and 10 pcs. furniture of option 2. It is necessary to determine the unit cost of furniture of option 1. The decision was made on the basis that its market price and production volume are higher than that of furniture of option 2.

After the first stage, the costs of complex production (Z cp) will amount to 100,000 rubles. (80,000 + 20,000).

The unit cost of product 1 at the split point (C 1-1) can be determined by the formula:

C 1-1 \u003d Z kp / K 1,

where Z kp - the cost of furniture option 2;

K 1 - the resulting amount of furniture option 1.

C 1-1 \u003d (100,000 - 30 × 40) / 200 \u003d 494 rubles / pc.

After the second production stage, the cost per 100 pcs. furniture option 1 will be the costs that came from the first stage, plus the costs of stage 2 materials, plus the costs of processing stage 2: 494 × 200 + 30,000 + 15,000 = 143,800 rubles.

Cost of 1 pc. furniture option 1 - 1438 rubles. (143,800 / 100).

Then the calculation can be repeated, taking the furniture of option 2 as the main one.

Using distribution method the cost of both products is calculated.

Example6

The initial data are the same as in example 5. The cost of products after the first processing stage is determined by the formulas:

1) for the first furniture option:

C 1-1 \u003d (Z kp × Furniture cost of option 1 / Sum of the costs of all furniture options received) / K 1.

C 1-1 \u003d (100,000 × 600 × 200) / (600 × 200 + 40 × 30) / 200 \u003d 495 rubles / piece;

2) for the second furniture option:

C 1-2 \u003d (Z kp × Furniture cost of option 2 / Sum of the costs of all furniture options received) / K 2.

C 1-2 \u003d (100,000 × 40 × 30) / (600 × 200 + 40 × 30) / 30 \u003d 33 rubles / pc.

Further calculation of the cost of each product after the second production stage is similar to the calculation when applying the elimination method.

The choice of costing method largely depends on the characteristics of the production process and the types of products produced. If it is the same type of product that moves from one production site to another in a continuous flow, the process-by-process costing method is preferable. If the production costs of various products differ significantly from each other, then the use of such a costing method cannot provide correct information on production costs, and in this case, the order-based costing method must be used. In some cases, a mixed version of the use of two systems is also possible, depending on the nature of the movement of products through production areas.

С = З/Х, (3.1)

where C is the cost of a unit of production, rub.;

C - total costs for the reporting period, rubles;

X - the amount produced for the reporting period

products in kind.

Simple two-step calculation method used when the business produces one type of product and there is no work in progress, but there are remnants of finished products in stock.

Unit cost calculation is carried out in three stages:

1) the production cost of all manufactured products is calculated, then the production cost is determined by dividing all production costs by the number of manufactured products
units of production;

2) the amount of administrative and commercial expenses is divided by the number of products sold during the reporting period;

3) the indicators calculated in the first two stages are summarized.

where З - total production costs

reporting period, r.;

Zuk - management and commercial costs

reporting period, r.;

X - the number of units of production,

produced in the reporting period, units;

X p - the number of units of production,

sold in the reporting period, units

Example

The enterprise produced 400 units of products during the reporting period, and sold 380 units. At the same time, the production cost amounted to 500 thousand rubles, management and marketing costs - 150 thousand rubles. Determine the cost of production.

Let's determine the production cost: С1 = 500 thousand rubles: 400 units. - 1.25 thousand rubles / unit

Let's determine the amount of management and marketing costs per unit of products sold:

C2 \u003d 150 thousand rubles: 380 units. = 0.39 thousand rubles / unit The cost of a unit of production will be:

C \u003d C1 + C2 \u003d 1.25 thousand rubles. + 0.39 thousand rubles. = 1.64 thousand rubles.

The simple two-stage calculation method allows:

estimate stocks and finished products at production cost;

include the costs of management and marketing in full on the number of products sold.

Simple multi-step costing method used when one type of product is produced, there are stocks of work in progress and stocks of finished products in stock.

The unit cost of production is determined by the formula:

C \u003d Zpr 1 / X 1 + Zpr 2 / X 2 + Zpr 3 / X 3 + ... + Zprn / Xn + Zpr / Khupr. (3.3)

where C is the total cost of a unit of production, rubles;

Zpr 1, Zpr 2, … , Zprn - total production

costs of each redistribution, rub.;

X 1, X 2, … , Xn - the number of semi-finished products,

made in the reporting period

each redistribution, pcs.;

Khupr - number of units sold

products in the reporting period, pcs.

The progressive method of cost accounting and calculation is used at enterprises, the technological process in which provides for the processing of raw materials at several stages (repartitions). As a result of a successive series of redistributions, the final product is obtained.

Examples of such enterprises can be enterprises of the oil refining, chemical, textile, pulp and paper, metallurgical industries.

Method applicable:

§ in industries where the production process is characterized by the presence of several stages of the technological cycle;

§ at enterprises manufacturing various products, the manufacturing processes of such products can be divided into constantly recurring operations;

§ in conditions of mass production, when the range of products produced is small, but its volume is sufficient;

§ in an enterprise where there is a specialization of jobs to perform, as a rule, one specific operation;

§ if the proportion of mechanized and automated processes in the production process is significant, etc.

Cost accounting objects for production are individual process steps , A object of calculation - product (or products) of each completed repartition .

Analytical accounts for accounting for production costs are opened by redistribution.

redistribution- this is a part of the technological process (a set of technological operations), ending with the receipt of a finished semi-finished product, which can be sent to the next processing stage or sold to the side. As a result of the successive passage of the source material through all stages, finished products are obtained, i.e. at the exit from the last redistribution, we have not a semi-finished product, but a finished product.

The essence of the distribution method is that direct costs are reflected in the current accounting not by product type, but by production stages (stages), even if different types of products can be obtained in one stage.

The reliability of the calculation depends on the ability to most objectively divide the costs into direct and indirect and to allocate the maximum possible number of direct cost items. If several types of products are produced in a division, then the indirect costs of each division are distributed among the types of products in proportion to the selected distribution base (natural indicators of output, physical and chemical indicators, etc.).

In general, the scheme of the step-by-step method is shown in Fig. 3.3.

Features of the per-peritional method of cost accounting and costing are as follows:

§ accumulation of production costs by departments, regardless of individual orders;

§ write-off of expenses for the calendar period;

§ it is assumed that material costs are incurred at the beginning of the production process, and the added costs are distributed evenly throughout the production cycle;

§ costing is carried out using the averaging method or FIFO.

Averaging method assumes that stocks of units at the beginning of the period were started and completed within the reporting period.

According to FIFO method , the items in work-in-progress at the beginning of the period will be completed before new items go into processing.

Calculation technique the cost of a unit of production with the perepredelnoy method consists in filling in three analytical tables. In the first table, the volume of production is calculated in conventional units; the second allows you to estimate the cost of one conventional unit of production. In the third, final table, the cost of finished products and work in progress is determined. Using the information contained in these tables, determine that part of the costs that relates to finished products, and that part that remains in work in progress at the end of the reporting period.

A necessary prerequisite for costing is the organization consolidated accounting production costs.

The domestic school of accounting interprets the concept “consolidated accounting” as a system for summarizing production costs by items of expenditure in the context of main and auxiliary production shops, types of products in general for the enterprise in order to prepare information for calculating the cost certain types finished products, all manufactured products and for the distribution of costs incurred by the enterprise between finished products and work in progress.

In industry, two options for consolidated cost accounting and product costing are used - non-semi-finished And semi-finished. The application of the first or second variant of the summary accounting for production costs depends on the need to determine the cost of some semi-finished products, which are unfinished products of the main production. This may be caused by the implementation of part of the semi-finished products on the side. Then it will be necessary to produce a set of costs for the production of a semi-finished product and determine its cost.

Production cost accounting with a non-semi-finished version, without transferring the cost of semi-finished products of own production when transferring them from one structural unit into another.

The non-semi-finished method provides:

1) only accounting for costs by repartitions, the cost of semi-finished products after each repartition is not determined, only the cost of finished products is calculated;

2) cost accounting is carried out without accounting records when semi-finished products of own production are transferred from one structural unit to another;

3) control of the movement of semi-finished products is carried out in kind, without entries in the accounts;

4) the costs of manufacturing semi-finished products are accounted for by shops in the context of cost items;

5) the cost of raw materials is included in the cost of only one processing unit;

6) added costs are reflected for each redistribution separately;

7) the cost of a unit of finished products is formed by summing up the costs of production units (redistributions) taking into account the share of their participation in the manufacturing process;

8) production costs are distributed between commodity output and work in progress.

Advantages this method are as follows:

1. simplicity;

2. the absence of any conditional calculations that decipher the costs of previous workshops and redistributions;

3. calculation accuracy.

Disadvantages of the non-prefabricated method:

1. inventory of WIP in all shops;

2. it is impossible to determine the cost of semi-finished products when they are transferred from one process to another. And this is necessary in cases where semi-finished products are sold to the side.

Semi-finished method is used when each stage, with the exception of the last one, is a completed stage of processing raw materials, as a result of which semi-finished products of own production are obtained, ready for further use in production or for sale. The semi-finished method combines the operational accounting of the movement of parts and assembly units in physical meters, taking into account the actual shop cost. After each redistribution, the cost calculation is carried out .

This accounting option involves the use of account 21 "Semi-finished products of own production." The calculation should contain a complex article of the same name, which is subsequently deciphered and detailed.

This allows:

1) identify the cost of semi-finished products at various stages of their processing;

2) to exercise objective control over the formation of the cost of production.

The disadvantage of the semi-finished method is a high labor intensity.

In management analysis, the total cost is calculated in order to determine all the costs of manufacturing products. This indicator allows you to understand how profitable the organization is and how to price goods. Let's figure out exactly what costs for manufacturing products include the full cost and in what order such a calculation is carried out.

The total total cost of a SOE shows the total amount of all resources spent on production and commercial, that is, related to marketing, expenses. Figuratively speaking, this is an assessment of all the costs of manufacturing a product and its sale - from the initial production stage to the final delivery to the consumer. The total cost usually includes the following types of costs:

Production - consist of material, raw materials, fuel and energy, labor, depreciation, social and other costs directly spent in the production of HP and its delivery to the warehouse of the organization. This group also includes the amounts of taxes, credit interest, rent, consulting, advertising, legal, auditing and other services received from outside.
Commercial - consist of expenses associated with transportation, packaging, storage, advertising in order to sell the produced HP and bring it to the end-user market.
General production - for the maintenance of the main, auxiliary, service industries.
General business - to ensure the successful operation of the entire enterprise. They may not be directly related to production cycles, but without them, the successful functioning of a business is impossible.

Regardless of which classification group the costs belong to, calculating the full production cost of production means taking into account all costs - whether they are fixed or variable, overhead or direct costs. For calculation, indirect costs are allocated depending on the selected distribution base. The total cost of goods sold is a gross indicator that characterizes the costs of the entire volume of manufactured products, or a single indicator that shows how many expenses are spent on the production of one product.

Reduced cost is the calculation of products on the basis of only direct costs of a variable nature associated with the production of HP. With this accounting option, general business expenses, which are considered conditionally fixed, as ordinary costs are attributed immediately to financial results, without using accounts 20, 29 or 23 (PBU 10/99). The reflection of such indirect costs is made by the accountant on the account. 44 or 26 depending on the type of activity of the organization. At the end of the period, the collected amounts are subject to full write-off to the account. 90.

An abbreviated version of product costing greatly simplifies accounting and does not affect the determination of the final result of economic activity. But this method distorts the data and does not always allow you to accurately calculate the amount of money the company spent on producing a product or providing a service. In addition, only the full cost of goods sold enables managers to perform long-term planning, analysis and production control to increase the profitability and profitability of the business. The method used should be fixed in the accounting policy of the company.

How to find total cost

The total cost of manufactured products of the enterprise is equal to the monetary value of the total costs. When calculating, the raw materials, financial, labor and other resources spent in the production process, as well as the costs of selling and storing goods, are evaluated. The obtained value helps to understand how expensive the production of HP was for the enterprise. To know how to calculate the total cost of production, it is necessary to determine the financial indicator by summing up.

Calculation is performed by adding production and commercial costs, as well as general business (if any). After the calculations, it becomes clear at what level to set prices for goods or services so that the enterprise can recoup the costs of manufacturing and start a new production cycle, that is, work without loss. Conducting a deep analysis of the cost structure allows you to identify reserves for saving resources and more efficient use of them. Next, we will consider, using examples and formulas, how the total cost of GP is determined.

How to calculate the total cost of production - formula

We have determined that the total cost of production is all the costs of the enterprise. Therefore, in order to make a correct calculation, it is necessary to sum up all the costs. For this, the following general formula for calculating the total cost of production is used:

Full cost = PS + SR, where:

PS is the value of the production cost, and SR is the volume of marketing expenses.

The above formula is generalized and understandable to those who have already encountered product costing. If you don’t know what the terms are made up of, check out the expanded formula, which looks like this:

Full cost = construction and installation works + PF + FER + ZOP + ZAP + A + SV + PPR + SR + TR + RPS, where:

SMR - material and raw material costs;

PF - semi-finished products spent in production;

FER - fuel and energy costs;

ZOP - the salary of the personnel of the main and auxiliary productions;

ZAUP - the salary of the administrative and managerial personnel of the company;

A - the accrued value of depreciation of the fixed assets used;

CB - the amount of accrued insurance premiums;

PPR - the value of all other production costs;

SR - the amount of marketing expenses;

TR - transportation costs;

RPS - the amount of other marketing expenses.

An example of calculating the total cost of GP

To make it clear what the total cost of the enterprise's products is equal to, consider an example on specific organization. Suppose a company manufactures electrical equipment. The expenses incurred during the period are shown in the table below. Let's do the costing of products in two ways - at full cost, as well as reduced. At the end, we will calculate the financial indicators from the activity.

Table of economic indicators for calculations

Name of indicator	Value in rubles
	75000
Labor in rubles	160000
General production in rub.	25000
General business in rub.	40000
The total volume of production in pieces.	50
Cumulative sales volume in pcs.	40
The final price of one unit of production in rubles.	11000

Costing table - the calculation is done in two ways

Name of indicator	full cost option	Reduced Cost Option
Material and raw material costs in rubles.	75000	75000
Labor in rubles	160000	160000
General production in rub.	25000	25000
General business in rub.	40000	–
The total cost of GP in rubles.	300000	260000
Unit cost of GP in rub. (for 1 piece)	6000 (300000 / 50)	5200 (260000 / 50)
The value of the cost of the sold GP in rubles.	240000 (6000 x 40)	208000 (5200 x 40)
The value of the cost of the balances of the GP at the end of the period in rubles.	60000 (6000 x 10)	52000 (5200 x 10)

Profit calculation table by production activities organizations

Thus, the example shows that the total cost of goods sold allows you to take into account all the expenses incurred by the enterprise and more accurately set the price indicator in order to ultimately get more profit.

Features of the full cost method

When evaluating current costs, the cost accounting method at full cost has been developed in order to establish a fair price for manufactured products. If the enterprise produces different products (types of goods), previously responsible employees need to divide all costs by responsibility centers, that is, places of occurrence. Then cost carriers are set up for their distribution. And finally, for each specific product, the costs are related depending on the production need.

The calculation process is quite complex and usually combines the work of several specialists. For the accuracy of calculations for products, estimates and norms for writing off costs are developed, prices are determined at which costs are written off, and at the final stage, analysis and control of indicators are carried out. Like other methods, the full cost method has its advantages and disadvantages. The advantages include the elimination of monopolization of the market, since with this option of calculating goods, the price for the consumer is set on average at the same level. At the same time, sellers get the opportunity to realistically assess their costs and calculate the optimal cost of products for profit.

Among the shortcomings, it should be noted that such a technique does not take into account the current competition in the current market, therefore, the existing demand for products is not taken into account. A change in the level of costs with fluctuations in production volumes is not amenable to planning. In addition, attributing the amount of fixed costs to the cost of products or services can somewhat distort the impact of a particular product on the financial result of an organization. Which method of costing manufactured products to choose, each organization decides independently.

It is possible that for some purposes (or external users) it will be necessary to calculate the cost according to traditional full indicators, and for others - according to reduced or combined ones. When choosing, one should take into account the specifics of the activity, the nature of the products produced, seasonality, the time indicator of planning and other factors. The most widely used method of full cost accounting has received in small companies, as well as where a narrow range of products is produced. If the nomenclature is significant, and the business is large-scale, it is recommended to use cumulative methods and techniques for calculating the cost of GP.

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