The cost of production has a leading place in the system of all indicators that characterize production efficiency and further sales. The cost of production is called the cost of its production, as well as sales, which are expressed in cash. It reflects the various aspects of the financial, economic and production activities of any enterprise: what is the degree of use of financial, labor and material resources, as well as the quality of work not only of individual employees, but of the entire management. The calculation of the actual cost of finished products is of great importance for the enterprise. Indeed, the calculation of this indicator is required for many reasons, and mainly, in order to determine the profitability of certain types of products, as well as the entire production, to determine wholesale prices for products and to carry out in-house cost accounting. The state currently has a regulatory role in relation to cost.
There are various types of production costs , while it is one of the main factors for generating and generating profit. The costs of manufacturing any product are classified by economic elements, as well as costing items. They are material (purchased semi-finished products, raw materials, energy, etc.), the second group - labor costs, the third - depreciation of fixed assets, the fourth - deductions for various social events and other costs.
Types of production costs are allocated depending on the completeness of coverage of all production costs. The first group is the technological cost, this includes the costs of maintaining the technological process of production. The second group is the production cost, it includes the costs of producing a particular type of product. The third group - the total cost - all expenses not only for production, but also for the sale of products.
Types of production costs are distinguished by the object of calculation. If it is gross output, then this is the cost of its production for the current period. And if - sold products - expenses not only for production, but also for its sale during any cycle, for example, a year.
There are also such types of production costs as planned, estimated, reporting or actual and normative. All of them include different costs.
Types of production costs are used for different purposes of analysis. So, the production cost is needed in order to assess the cost characteristics of the entire production process. Technological cost is required to evaluate the costly characteristics of the process, and the full is the basis for assessing the whole complex of non-production and production operations, it is the basis for calculating the price of products solely by the cost method.
Accounting and analysis of the cost of production has the main tasks. First of all, we are talking about an objective assessment of the implementation of the cost plan and its changes relative to past reporting periods. The second task is to investigate the causes that caused the deviation of any indicators from their planned values. The third task is to provide cost centers with all the necessary information in order to effectively and efficiently manage cost formation. The fourth task is to contribute in every possible way to the development of the most optimal amount of planned costs, normative and planned cost estimates for certain types of products and products. The fifth task is to identify and make a summary calculation of all reserves to reduce costs not only for production, but also for its implementation.