Costing

COSTING

COST CONTROL:
Constant cost control allows you to update costs with new tariffs, or in the case of external work centers, with new price lists that continually evolve. Internal costs, especially labor costs, are reviewed with the costs per minute for the individual processes of the departments involved. The costs of the components can be updated directly from the costs of the materials entering the warehouse with the relative cost of the last purchase, the cost with which the warehouses are always updated, of raw materials, accessories, subsidiary materials and semi-finished products. As well as the costs of processing and materials, it is possible to control and align the costs of logistics, transport and other costs adopted by the company in the cost sheets. The periodically revised costs can coexist in the product, this possibility allows the company to see the trend of the product costs and to draw up comparative analyzes in the various periods of time.
COST ITEMS:
Cost items are the detailed elements of each individual cost. Each of the cost items is freely defined by the Key User who models the cost sheet. The cost items contribute to forming the subtotals of the cost elements. The cost items are valued by the cost models associated with them. The set of cost items forms the total cost of the product.
COST AND PRICING:
The calculation of the base price of each individual product can be derived directly from the cost sheet. The cost sheet allows, through controlled cost increase models, to arrive at the base price of the individual product. By base price we mean that price threshold below which the sale cannot go, the base price is generally established by the company as the minimum price below which there is no profit relating to the product in question. The base price obtained from the cost sheet will be the input for calculating the price lists that marketing can suggest applying to the various markets that the company intends to address.
BUSINESS COSTS: Definition of company costs: • Costs of various production components, raw materials, accessories, subsidiary materials, semi-finished goods, molds, etc., are found in their respective BOMs (Bill of Material). • Product costs are found in the respective work phases defined in the product cycles, associated with the expected work centers, whether internal (departments) or external (Work Center laboratories). • Logistics costs can be defined for the reference item; they are modular and can be identified not only by the product but also by the average time the product stays in the company's warehouse. • Advertising costs.................. • Transport costs................... • Other freely definable costs by the company. The definition of costs, both direct and indirect costs, is freely definable by the Key User when constructing the product cost sheet.
STANDARD COSTS: The product cost is calculated at standard cost. Choosing to set the cost sheet with standard cost calculation is not the only option; the company can decide to calculate the cost at actual cost. The choice of the standard cost calculation model is based on the following reasons: • Standard cost allows having periods, determined by the company, where results from production performance (return from actual costs) can be compared. •Standard cost allows having periods, determined by the company, where results from production performance (return from actual costs) can be compared. • Standard cost provides an average cost for all cost elements contributing to the formation of cost items that make up the product cost sheet. • Ultimately, the choice of valuing products at standard cost simplifies the use of all cost variables that contribute to creating a stable cost model to achieve an optimal pricing to provide to marketing (base price for calculating product and market price lists).

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