How to determine the production cost of production

The need to determine the production cost of production is faced by everyone who is engaged in planning the activities of the manufacturing enterprise and its analysis. The cost of production is one of the main indicators of the economy of production.

Instruction manual

1

In order to determine the production cost of production, you need to find out the structure of production costs and their amount per unit type of product. The calculation begins with the calculation of the costs of raw materials, energy, materials, semi-finished products that are used directly in the process.

2

Calculate the following type of expenses - the wages of all production workers, taking into account social contributions defined by the norms.

3

If you are calculating the production cost of producing new types of products, do not forget to take into account the costs of mastering new technologies and preparing the production. The content of the articles is close to non-capital expenditures related to the improvement of technology to improve product quality.

4

The next type of cost is the cost of providing materials and raw materials, maintenance of production, maintaining the basic functions of the enterprise.

5

Further, the expenses are considered for the implementation of safety measures, for environmental events, for ensuring working conditions and environmental equipment.

6

Include in the cost of production the costs of maintaining the equipment, its maintenance and operation. Also consider tool wear and the need to replace them during production.

7

Consider all other probable expenses associated with the production of products, this may include various types of direct and indirect costs. Classify them according to cost elements, supplementing with classification by costing items.

8

Add up all kinds of costs for a certain period of time and calculate the cost of production. You can do this as with the calculation of the average value - the ratio of the average cost over time for a while to the total number of products released over the same time. Another calculation option is to determine the cost by line-by-line determination of all types of production costs per unit of output.