How to decide on the scale of production for the costing exercise

There are several types of costs that should be noted on this page. Please be as accurate as possible, basing your information on the most up-to-date prices and amounts you can find. Include discounts in the prices. Prices for inputs may have to take seasonal swings into account. Adapt this form to your specific project needs.

TIE ALL EXPENSES TO ONE CYCLE OF PRODUCTION. In other words, for rent you may want to note the rent for six months, if that is how long it takes to complete one cycle. On the other hand, if a machine lasts for six months and the production cycle is only one month, then include one-sixth of the cost of the machine under Capital Costs

COSTING WORKSHEET

COSTS INCURRED FOR ______________ UNITS OF ____________________________

RAW MATERIALS COSTS
Type Of Raw Material (Delivered to group)	Quantity	Cost Per Unit	Total Cost
1.
2.
3.
4.
LABOR COSTS
1. Training Materials
2. UNSKILLED LABOR
3. SKILLED LABOR
ADMINISTRATIVE/OVERHEAD COSTS
1. Rent, Utilities
2. Notebooks, pens, etc.
3. Office materials(paper, copies, etc.)
4. Other
CAPITAL COSTS
1. Machine
2. Machine
3. Tool
4. Supplies (Maint.)
5. Repairs Likely
MARKETING COSTS
1. Transportation
2. Packaging Costs
3. Visits to Customers
4. Other Costs
TOTAL COSTS PER	UNITS OF

 

DIVIDE TOTAL COST OF PRODUCTION BY NUMBER OF UNITS. THIS IS THE MINIMUM PRICE PER (UNIT TO BE SOLD. IS THIS PRICE ACCEPTABLE TO CONSUMERS?