1. Cost sheet -RAHUL JAIN (Striving for excellence) BCOM (H), MBA, FCS
WELCOME TO ALL OF YOU
Cost sheet
-RAHUL JAIN
(Striving for excellence)
BCOM (H), MBA, FCS

2. Cost
Any amount incurred during the operations for providing the good or service to get the output into the hands of the customer
Controlling costs is essential to
business success
A sacrifice of resources.

3. Apparel Products Value Chain By Lyn Fernando
-Lack of Direct contacts/ Access to Retailer.
-Long lead time
- Cost of Agents
Need to develop strong networks & lobby groups. Free Trade Agreements, concessionary tariffs
Buyer (Retailer)
100%
Selling & Distribution (Agents)
High Cost Structure ( Labour, Utility) Wastage use of CAD/CAM
Labor Laws, Invest in Human Resources
Lack of Skilled Management
Low productivity,
Proximity to Suppliers
High energy cost
Proximity to market, regular sailings -sea & Air. Electronic Data Interchange for documentation
Outbound logistics
Manufacturing (cut, sew & finishing)FOB 10-25% of Retail
Lack of Advanced Manufacturing Technology
Dependency on imported raw material, long lead times,delays at customs, documentation, EDI
Raw materials /Accessories –40-70% of FOB
Lack of Specialty fabrics & Accessories
Sourcing
Product Development
Non availability of advanced product development facilities
Design
Lack of design capabilities

4. Basic elements of Cost
Material
Labor
Expense

5. Prime Cost
Direct Material Consumed
+ Direct Labor
+ Direct Expense

6. COST SHEET COST OF PRODUCTION Total cost & SALES COST OF SALES
PRIME COST
+ TOTAL DEPRECIATION
+ FACTORY OVERHEADS
Total cost & SALES
COST OF SALES
+ Other Overheads
=Total cost
+Profit
=Sales
COGS
+ OFFICE EXPENSES
+ S & D EXPENSES
COST OF GOODS SOLD
COP
+ OPENING STOCK
- CLOSING STOCK

7. Manufacturing costs
Manufacturing: Activities and processes that convert raw materials into finished goods.
Manufacturing Costs include:
Direct materials
Direct labor
Direct Expense
Manufacturing overhead

8. MANUFACTURING OVERHEAD
Consists of costs that are indirectly associated with manufacturing the finished product.
Includes:
• Indirect materials
• Indirect labor
• Indirect expenses such as
Depreciation on factory buildings and machines
• Insurance, taxes, maintenance on factory facilities
Manufacturing Overhead

9. FACTORY OVERHEADS- Examples
Salary paid to merchandiser
Salary paid to production manager
Floor incharge salary
Q.A. + Q.C.
Plotting boy
CAD operator
Salary paid to fabric head
Salary paid for line supervisor
Salary paid to machinery maintenance
House keeping
Guard
Medical care taker
Fuel
Electricity
Water consumption
Oil and Consumables
Needles
Rent/Depreciation on Factory Assets

10. OFFICE AND ADMINISTRATION OVERHEADS: Examples
Salary paid to:
chairman MD GM
Receptionists
HR persons
Accountants
Purchases Dept. Persons
Office Boys
Telephone Expenses
Stationary Expenses
Electricity Expenses of office
Rent/Depreciation on Office Assets

11. SELLING AND DISTRIBUTION OVERHEADS- Examples
Salary paid to selling and marketing staff
Advertisement cost
Sample distribution
Export documentation
Testing expense
Buying agent commission
Conveyance
Trade Fair and other Promotional expenses
Website and ecommerce expenses

12. Other Overheads Financial Overheads Miscellaneous Expenses
Non Operating overheads
Taxes

13. Assignment Individual Assignment
Questions of Costsheetassignment.xls (Excel file)
Write Key learnings/Reflections of the class

14. Some important points Academic Honesty Reference Any Source
When Confused Ask Instructor
Contact me: Rahul Jain ( , Yahooid:rahulkjain16)