Types of production costs
Every self-respecting entrepreneur must be educated in his field of activity, know the basic components that continue to develop his organization further. Cost is a very important indicator in many sectors of the economy. Which ones? What is she like? We will consider all this in the article below.
Cost price does not exist as a separate, independent concept. It always implies a certain classification, divided into species. So, the types of costs are as follows:
- the cost of agriculture: individual and industry;
- depending on the timing: planned, actual, provisional;
- actual (commercial);
- in relation to the process distinguish the main and the invoice;
- by way of inclusion: direct and indirect.
Let us now consider some of the listed varieties.
The main costs of the organization are directly related to the manufacture of goods. This includes such expenses as living labor and material resources. In this case, the types of production costs are divided into several types additionally.
Overhead costs are mainly related to the organization and distribution of production. They are divided into general and overhead. General business directly in contact with the enterprise and the management of a particular industry, department. General production types of cost - with the organization and management of the whole economy.
We now turn to direct and indirect:
- To direct include costs, representing the cost of manufacturing the goods, if they can be included in the cost of production.
- The indirect ones include those that cannot be attributed specifically to the production of certain products. Similar products and costs for it must be distributed by types of indirect ways.
However, these are not the only important types when it comes to cost.
Dependence on volume
Costs, depending on the volume of manufactured products, are distributed to such items:
- on an ongoing basis: remuneration of labor of administrative management personnel, depreciation deductions, maintenance of premises necessary for production and personnel;
- variables - contain the costs of the necessary seeds, feed, fertilizers.
Their coefficient is economic homogeneous, which can not be decomposed into parts of the composition:
- material costs;
- staff costs;
- social needs;
- depreciation of all necessary funds;
- other costs.
These simple items are important components of cost in general, that is, you need to follow all the criteria for the best work of the enterprise.
Types of cost of the enterprise can be divided into additional classifications. It all depends on the goal you want to achieve (plan, analyze, put on record).
- planning - shows the maximum possible amount of costs and accepts only those with the available quantity and quality of equipment and work planning are necessary for the organization.
- according to the calculation - is used in the feasibility accounting for the justification of projects for implementing the objectives of the scientific and technical state
- reporting - shows the level of tasks for cost reduction on the basis of a comparison of planned costs with actual ones.
Types of cost, as is already clear, are different.But how to use and apply in the work all these concepts?
The cost of a particular product can be determined in different ways. To do this, it is necessary to carry out some calculations.
When analyzing certain categories of products or other types of goods offered, groups of expenditures per unit of goods are used according to the costing items required in the process of setting prices for different categories of a commodity product, determining their profitability, analyzing the costs of making the same product with other competitors and much more.
Take into account the planned and actual cost estimates. The main object of such calculations is a finished product that is intended for release from the organization.
The list of articles related to costing, the composition, methods of distributing expenses by type of goods are determined by special guidelines that relate to the planning, accounting and, of course, the cost of the goods (works or services), taking into account the purpose, nature, methods of the manufacturer.
Cost of production, types of costs, analysis of data on a single product - all these are the main components of industry in enterprises.
At many industrial enterprises, the following nomenclature (it is approximate) of calculation cost items has been adopted:
- resources, materials, raw materials, waste - all this is deducted;
- energy is technological;
- wages for production workers;
- additional wages for production workers;
- deductions from wages (actual and additional) for general social needs (taxes, etc.);
- maintenance of machinery and equipment, commissioning;
- expenses that are overhead;
- costs that are general business;
- preparation for production and its development;
- expenses that are not related to production, for example, advertising, marketing and much more.
As we see, this is another important component of the excellent work of any enterprise.
In the process of managing any enterprise, there are several necessary functions: regulatory and budget.
The estimated cost is determined on the basis of temporary technologies and increased standards for the distribution of the necessary time, equipment and resources.It is necessary for the correct substantiation of a one-time or long-term price policy for a product.
Regulatory cost is compiled on the basis of existing technologies and regulatory methods for recording production. This means that, based on the indicators operating in the organization. At the same time, at the beginning of each month, the rates of resources, materials, gasoline, various types of energy (electricity, water, steam, compressed air), purchased semi-finished products, etc. are taken into account.
Dependence on quantity
What is the cost of production? Types of costs we have already dismantled. The cost of the necessary materials is more than necessary for the normal functioning of the business.
Everything really depends on the amount of products that are being produced. All costs for its manufacture and sales are divided into semi-fixed and variable. They are sometimes referred to as proportional and disproportionate.
Conditionally fixed costs do not depend on the change in the volume of output. But this is only under the condition of maximum use of all the production factors of the organization that are active.
Contingent fixed costs include depreciation of fixed assets, wages of managerial staff and temporary workers, rent for premises and equipment, utilities, etc.
The total number of conditionally permanent allocated finance is distributed throughout the organization and its structural divisions. Then for each article in the calculation of the cost is determined by their part. It all depends on the conditions and production technology. The definition of conditionally fixed costs at each enterprise is developed after careful analysis, taking into account all the technical and material conditions of work of the entire organization.
Variables change in accordance with the volume of manufactured goods. In the unit cost of such a product, they are unchanged. They can be distributed to each type of product, following the norms of costs and prices of units of raw materials and supplies.
The total number of variable and fixed costs forms the cost of the goods.
About the cost in general
As we see, work in an organization is extremely difficult. It is necessary, in addition to the desire and capital,to be well-read and educated economically, to be able to navigate in such terms as cost types, analysis of financial and economic sustainability of an enterprise, to be able to allocate capital, to correctly allocate the necessary amounts to expenses.
In order not to keep absolutely all the information in my head, many businessmen use the services of business analysts and other qualified personnel. The cost, costs, types of cost - for each of these concepts can be responsible for an individual.
Thanks to the cohesive and proper work of specialists, the organization and its production will grow and develop.