In there:
Total allocation standard ꞊ ∑ (Actual quantity of standard products x Allocation standard of standard product i)
Total cost method
This method is applied in enterprises where the product manufacturing process is carried out in many production departments and many technological stages. The cost aggregation objects are detailed product parts or technological stages.
Product manufacturing cost = Total cost of i-th part
Method of eliminating by-product value
Total cost of main product = Value of main product DDĐK + Total costs incurred during the period - Estimated value of recovered auxiliary products - Value of main product DDCK
Step method
- The step-by-step costing method calculates the cost of semi-finished products from the previous stage (sequential carryover method)
With this method, the cost of semi-finished products is calculated at each stage, applied to semi-finished products at each stage, each workshop is considered as a finished product sold outside.
In this method, the cost of the semi-finished products of each workshop must be calculated and transferred to the next workshop in sequence until completion:
Z NTP gđỉ = Z NTP gđ(i-1) + D k k đ + C gđỉ – D k k đ
The cost calculation sequence is shown in Diagram 1.1:
CP NTP Phase 1
switch to
CP NTP GD n-1
Other costs phase n
Completed City Cost
NTP Phase 2 Cost
Other costs
Phase 2
Main material cost
Other costs phase 1
Phase 1 Phase 2 …….. Phase n
NTP Phase 1 Cost
Diagram 1.1: Sequence of cost calculation according to sequential transfer method
- The step-by-step costing method does not calculate the cost of semi-finished products transferred from the previous stage (parallel carryover method)
Do not calculate the cost of semi-finished products at each stage, applicable to companies where semi-finished products at each workshop are transferred entirely to the next workshop for continued production, not considered as finished products sold outside.
Based on the production cost at each stage and each workshop to calculate the production cost there included in the finished product at the final stage and workshop.
First, calculate the production cost of stage i included in the finished product.
in the city
Production cost= | D dk gđỉ + C gđỉ | * | SL TP last period |
SL go + SL go |
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𝑖=1
Z TP = ∑ 𝑛 𝐶𝑃𝑆𝑋 gdi in the finished product
The cost calculation sequence is shown in diagram 1.2:
CPSX GD n
in the city
CPSX
GĐ1 in TP
Production plan Phase 2
in the city
Phase 1 Phase 2 ……… Phase n
CPSX phase 2
CPSX phase n
CPSX phase 1
Cost of finished products (detailed by cost item)
Diagram 1.2: Sequence of calculating step-by-step costing using the parallel transfer method (Step-by-step method with Z calculation of semi-finished products)
Order method:
This method is applied to enterprises that produce according to the buyer's order. According to this method, the object of collecting production costs is each order, the object of calculating the cost is the product of each order. For direct costs (direct material costs, direct labor costs) incurred during the period directly related to a particular order, they are directly accounted for that order according to the original documents. For general production costs, after collecting, they will be allocated to each order according to the appropriate standard (production hours, direct labor costs, etc.).
Product cost is only calculated when the order is completed. For orders that have not been completed by the reporting period, all costs collected according to that order are considered as final SPDD. For orders that have been completed, the total costs collected according to that order are the total product cost of the order.
This method is simple and easy to do, but has the limitation that the cost calculation period is not consistent with the reporting period, and does not reflect the production costs spent in the month in the cost calculation table, so the actual cost of the completed order in the reporting period does not reflect the production results in that period. The product cost and the production cost are both estimated in nature. In the case of local products in the order, it is difficult to analyze the reasons for the increase or decrease in the cost of each type of product.
c) Product cost accounting:
Based on the actual production cost of products, labor and services completed and entered into inventory during the accounting period, make the following entries:
Debit account 155 – Finished products in warehouse
Debit account 632 - Cost of goods sold (sold directly without going through the warehouse) Debit account 157 - Goods on consignment for sale
Credit account 154 - Unfinished production and business costs
Accounting books: General journal, ledger accounts 155, 632, 157 and detailed books
Summary diagram of cost collection and costing at: Appendix 1.5
CONCLUSION OF CHAPTER 1
In this chapter, the entire presentation of the theoretical basis allows to draw some conclusions about basic concepts and viewpoints such as: costs, production costs, product costs and the close relationship between production costs and product costs. This is an important basis for any business that wants to organize effective production cost and product cost accounting.
The contents presented in chapter 2 will be the foundation for research and practical understanding of production cost accounting and product costing in the garment industry, proposing appropriate directions and solutions to improve production cost accounting and product costing in manufacturing enterprises in the direction of applying Vietnamese accounting standards, improving the efficiency of cost accounting and calculating correct cost.
CHAPTER 2
CURRENT STATUS OF PRODUCTION COST ACCOUNTING AND PRODUCT COST CALCULATION AT REGINA MIRACLE INTERNATIONAL VIETNAM CO., LTD
2.1. Overview of the company and factors affecting production cost accounting and product pricing at Regina Miracle International Vietnam Co., Ltd.
2.1.1. Overview of Regina Miracle International Vietnam Co., Ltd.
2.1.1.1. The company's formation and development process
- Company name: Regina Miracle International Vietnam Co., Ltd.
- Foreign name: Regina Miracle International (Vietnam) Co., Ltd
- Abbreviation: RMIV
- Registered address: No. 9, Dong Tay Street, VSIP Hai Phong Urban, Industrial and Service Area, Duong Quan Commune, Thuy Nguyen District, Hai Phong City, Vietnam
America)
- Charter capital: 4,412,291,312,000 VND (equivalent to 200,558,696 USD)
- Business line of the unit: Sewing costumes (except fur costumes)
Animal husbandry), industry code C14100 (Main); Footwear manufacturing, industry code C15200
- Tax code: 0201420068
- Date of operation: 01/07/2014
- Formation and development process: Regina Miracle International Group was established in 1998 with headquarters in Hong Kong. Regina's first factory is located in Shenzhen Industrial Park, China with a scale of 20,000 employees. It is a world leader in creating, designing and manufacturing lingerie, sportswear, and sports shoes for the world's leading brands. Based on production output in 2014, Regina is recognized as the largest women's lingerie manufacturer in the world today. In Vietnam, Regina Group currently has factories A, B, C, D, E in VSIP Hai Phong Industrial Park in operation. The company currently specializes in manufacturing women's lingerie, sportswear, and sports shoes for famous brands such as Victoria's Secret, Adidas, Nike, Under Armour, Uniqlo, ....
2.1.1.2. Characteristics of the company's business activities and management organization
a) Business characteristics of Regina Miracle Company LimitedInternational Vietnam
After more than 6 years of development and growth, today Regina Miracle International Vietnam Co., Ltd. is a firm enterprise in the world's lingerie fashion manufacturing industry. As an export processing enterprise, specializing in the production of lingerie fashion items, clothing and sports footwear for export to related parties, Regina Miracle International Vietnam Co., Ltd. plays the role of a contract manufacturer. Most of the main raw materials are purchased from Regina Miracle International Limited and the remaining raw materials are purchased from domestic companies. After completing production, the company sells most of the finished products to Regina Miracle International Limited. The company has five factories and allocates orders for different product lines or brands to each factory.
The complete production process includes the following steps: Fabric inspection; Cutting; Ironing; Assembling details; Sewing; Finished product inspection; Packaging; Delivery.
*
Fabric inspection
Cut
Focus on fabric structure, color, shrinkage, length/width, etc.
Match the details
is pressed
May
* Cut multiple layers of fabric at once
* Pressing fabric to remove wrinkles and shrinkage
* Match fabric, bra cups and straps with details at midriff, side and back
* Sew details like fabric, bra cups, and straps together
Finished product inspection
* Inspect each finished product
Pack
* Sort products by style, fold and put them in boxes
Delivery
* Move product crates to warehouse, storage area, etc.
Regina VN's manufacturing operations are labor-intensive.
Depending on customer requirements or in case Regina VN lacks production capacity, Regina VN will hire affiliates or independent parties to perform some steps such as fabric dyeing to complete orders.
Board of Directors
Human Resources Department
Administration Department
Testing Center
Production Planning Department
Production department
Order Tracking Department
Import-Export Department
Accounting Department
b) Management and organizational characteristics of Regina Miracle International Company LimitedVietnam
Set
Set | Set | Group | Part | Set | Part | |||||||
IT department | part | part | family | buy and sell | part | Play | ||||||
warehouse | device | labour | non-property | Labour | sustainable development | |||||||
technique | export | program | steady |
Diagram 2.1: Characteristics of business management hierarchy
* Board of Directors: Is the management board that runs the daily business operations of the Company. Under the supervision of the Corporation, responsible for all activities of the Company according to the Resolutions and decisions of the Corporation.
* IT Department: Scientific research, technology transfer, consulting, career training and development of IT applications, network system management, IT application systems serving the company's research, training and management activities.
* Human resources department: Support superiors (board of directors) to solve human resources issues in the company. Interact and support other departments when they have requests or difficulties in human resources issues.