production activity of any entity related to the implementation of various cost.They are an indication of past and future ability to involve economic resources in all production processes in order to achieve the ultimate goal.One of the main types of expenses - a material costs.Their plan - is the process of setting objectives for the entire organization and for its individual units.Targets are set in the form of production problems and the provision of funds for their implementation.
Material costs are a major element in most production costs, the share of which often amounts to 90% of the total amount of costs.The lowest share of these expenses is awarded only in the extractive industries.Material costs are very heterogeneous.They include the costs of materials and raw materials (with the exception of returnable waste).These include the cost of paying brokerage and intermediary services, commissions.The entire cost of materials and raw materials included in the cost without VAT.
Tangible costs include:
- purchased materials and raw materials;
- the services and work performed by third-party organizations or structural divisions of the enterprise;
- semi-finished products of various components that require additional processing (purchased semi-finished products to include raw materials, some of which have passed the stage of processing, but were not finished products);
- natural mineral raw materials and resources in terms of payments made on the exploration and the cost of remediation work;
- acquired the fuel used in the process, and for industrial and energy needs of the enterprise;
- loss of property (according to the norms of natural loss).
in all production and raw materials are released only in accordance with the established norms of consumption in the enterprise.Every month on the basis of production programs and standards for each product and the shop (unit) calculated the need for raw materials.This amount may vary with changes in production conditions.
The enterprises alone account for direct material costs, including costs of materials and raw materials (they are part of the product, so their value is directly related to certain finished products).The magnitude of these costs is not always calculated by multiplying the physical indicators used in the production.In some cases, these parameters are too large.Such materials are referred to as auxiliary.These costs relate to the enterprise to indirect material costs, which include overhead costs.Each company, based on its specific nature, alone decides which materials are basic, and which to the subsidiary.
Material costs are controlled by four basic methods: documentation (issued separate documents), the party of cutting (distribution of materials and raw materials for the account card - Cutting sheet) partionnogo control and accounting (batching and raw materials of uniform technological parameters), inventory (inventoryresidues and raw materials).
In some industries the distribution of raw materials and by type of commodity production is carried out by direct means.In some industries they relate to groups of products, so they are classified using indirect, regulatory or coefficient method.Material costs are estimated, respectively, the specific conditions of economic activity.