To the beginning entrepreneur: production costs

A novice entrepreneur must necessarily calculate whether his business will be profitable. One of the main aspects of this issue is the cost of production .

The economic costs of production are differently called the costs of the enterprise for the production and marketing of goods or services. They are expressed in monetary terms and include the evaluation of labor services and the investment of capital necessary to carry out productive activities. The costs of production directly affect the calculation of the cost of production.

In the economic literature, different types of production costs are described in several classifications. Let's consider some of them.

Actual - those costs that have a direct impact on the adoption of economic decisions. They are countered with the costs of the "sediment" type - the means spent for insurance cases, writing off debts and others that will never return to circulation.

Explicit costs (accounting costs) are expressed in accounting calculations. They are determined in accordance with the Regulation on the Composition of Costs for Production and Sales of Products Established by the Government of the Russian Federation (of 05.08.1992). These include material costs; Deductions for social needs; Labor costs, depreciation of fixed assets, other costs.

Entrepreneurial costs include, in addition to accounting, financing of investments in fixed assets and working capital, various payments (taxes, excises, dividends on shares, customs duties). This can include the costs of missed opportunities, which are called imputed .

The costs associated with the release of a certain volume of production are called aggregate . Of them, the average is allocated - they are per unit output volume. Limit costs are calculated per unit when the volume changes.

The costs of production can be constant and variable. Constants do not depend on changes in factors of production, output, etc. Such costs include the maintenance of the territory, buildings, management personnel. Variable costs, on the contrary, are subject to change depending on the volume of production. This can be the cost of purchasing materials, raw materials, the payment of additional employees, etc. In this connection, complete or total production costs , including both constants and variables, are allotted.

Specialists note that the allocation of costs on the principle of permanent and variable has a real economic meaning. This approach allows us to determine the competitiveness of the enterprise, to plan profit growth and reduce the loss ratio, and so on.

There are also allocated direct costs, which are calculated specifically in the cost of production. In addition, it is necessary to take into account and eksplatatsionnye costs that are associated with equipment, machinery, transport, etc.

Thus, the costs that significantly affect the development of production in general form are divided into groups:

A) on primary economic elements (for example, labor costs);

B) by object of expenditure (these are calculation items - raw materials, fuel, energy, operation, etc.);

C) by the method of attributing costs to the cost of production (direct - indirect);

D) on the role in the formation of the cost of production (the main - invoices); E) by the degree of dependence on the change in the volume of production, e) depending on the time of occurrence (current or forthcoming, future expenses).

Accounting for the costs of undertaking entrepreneurial activities is necessary to calculate the cost of goods or services. And the decrease in the cost of production is an important factor in the development of production. There are many ways to reduce costs, which are used by experienced managers. So it is worthwhile for a beginning entrepreneur to study this question.