iContro ERP Product Costing Solution :
is a procedure associated with managerial accounting designed to serve management in an operational situation. iContro product costing is intended accurately to determine the cost of a unit of production delivered by application of every resource used in its formation. The activity is only in part motivated by obtaining an accurate final cost that incorporates all contributing streams. In part it is a way of identifying cost components that can be addressed specifically in order to take cost out of the product by purchasing, redesign, re-engineering, retooling, packaging, and other interventions by management at whatever levels.
Product costing is also help to process of determining all business expenses pertaining the creation of company products. These costs can include raw material purchases, worker wages, production transportation costs and retail stocking fees. A company uses these overall costs to plan a variety of business strategies, including setting product prices and developing promotional campaigns. A company also uses product costing to find ways to streamline production costs to maximize profits by choosing raw materials that are more cost-effective can allow a company to increase profit from retail sales by lowering its product creation costs.
Product Costing in Manufacturing Industries ;
*Developing and maintaining supplier relationships. Transportation costs, including carrier payment terms; special charges in the realms of packaging, handling, and loading and unloading; and loss and damage expenses.
*Sales and freight terms that define payment terms, sales, and title transfers. Payment terms—options here range from 15 days to as many as 90 days in some industries, and letter of credit terms provide additional options.
*Costs to receive, process, or make ready, including unloading, counting, inspection, and inventory costs, as well as expenses associated with disposal of packaging and other product protection/transportation materials.
*Production costs accrued in actual manufacture of goods. Quality costs, including costs associated with defective products , inspections, product returns, and storage. Lot size costs, including inventory and cash flow costs associated with lots of varying size.
*Supplier inventory. Overhead costs of supplier and customer transactions, including billing, collection, payment preparation, and receiving processes.
*Product improvement and modification, including costs of correcting defects and standardization of materials and packaging.