Quota cost pricing

Basic definitions

is the cost of the end product, i.e. the end product cost and the number of its fixed cost calculation unit in the calculation according to pre-established fixed cost.

fixed cost valuation method concept: the fixed cost valuation method is a fixed cost in terms of the end product, all the production costs of the product (cost plus the cost of the product early in the month occurred) by subtracting the fixed costs after the end of the calculation of the balance of the product cost as the cost of finished products.

explained

In this way, early in product cost plus the cost of production of the month, the end of the fixed cost reduction in the product, the cost of the finished product as the balance. Monthly production costs from fixed differences, the entire burden of the completed product. This method is suitable for better quota management based on the consumption of fixed or fixed costs relatively accurate, stable, and the monthly change in the number of products in small products.

Details

1, between the product and the finished product cost allocation methods are: the product is not calculated cost method, the fixed cost product valuation method, according to the product consumption of raw material cost valuation method, method equivalent units in the product according to the calculation method of the finished product, the product according to the fixed cost valuation method and fixed proportion method.

in determining which companies allocation method employed, should proceed from the actual situation, consider the following specific conditions: ① the size of the end product quantity; ② the number of size variations in the end products; ③ product cost the proportion of the size of the fees; ④ quota management and so on the basis of good or bad.

2, the fixed ratio method using the dispensing end of finished products and the costs between the products, the production cost of a product and in proportion to the consumption of a fixed or a fixed fee in the finished product and the product. Wherein the raw material costs are based on the consumption of a fixed fee or a fixed allocation ratio; wage welfare and other processing costs may be allocated in proportion to each of the fixed costs, work can be allocated according to a fixed ratio. This allocation method is suitable for better quota management based on the consumption of fixed or fixed costs more accurate and stable, but at the end of each month the number of products a large change in the product.

using the product according to the fixed cost valuation method, by the end of the fixed costs in product cost pricing, all that kind of production cost (if there is early in the product, including early in the product cost included), minus calculated by the end of the fixed costs in the balance of the product cost, as the cost of the finished product. Production costs from fixed differences are all included in the cost of the finished product of the month, and the end product is not calculated from the difference in the distribution of quotas. This allocation method is suitable for better quota management based on the consumption of fixed or fixed costs more accurate, stable, and end of each month in the number of product changes little product.

3, the ratio of the equivalent units on the end of the method is the number of products corresponding to their degree of completion for the conversion yield of finished product (i.e., equivalent units), and finished products in accordance with the output of the end product when about the proportion of production, distribution and calculate the cost of finished products at the end of a way in product costs. The method of distribution applies to a large number of products in the end, the end of each change in the number of products is large, the proportion of production costs in each cost almost the same cost of the product. Using this distribution method, either the finished product or in products, it is necessary to allocate the cost of raw materials have to allocate processing costs.