COST SHEET: DIRECT COSTING

Per Unit Cost

Components Descripition Per Unit Consumption
Rate
Fabric
Shell denim twill fabric 2.3 mts Rs. 130/mt
Pocket interlining cotton 0.3 mt Rs. 35/mt
Waistband interlining polycotton 0.05 mt Rs.45/mt
Trims
Button copper metal button 1 Rs.0.90
Rivets copper rivets 6 Rs. 0.30
Size label back, below waistband 1 Rs. 0.20
Care label left front, below waistband 1 Rs. 0.40
Brand label sticker back side, right, leather 1 Rs.2
Zipper metal sliding zipper 1 Rs 10
Thread yellow color, 3 ply 2 bobbibs Rs. 5
Direct Labor
CMT
TOTAL DIRECT COST
Variable Overheads
Margin at 20% of total direct cost
TOTAL COST

profit= 30% of total raw material cost= 30% of (1725350-30000)=Rs. 508605

Price= 2070420 + 508605 = Rs. 2579025
price per unit = 2579025/5000=Rs. 515.80
 Per Unit Cost Cost for 5000 units
Price/ unit (in Rs)

Rs. 299 1495000

Rs. 10.5 52500
Rs. 2.25 11250

Rs. 0.90 4500

Rs. 1.80 9000
Rs. 0.21 1050
Rs. 0.41 2050
Rs.3 15000
Rs 11 55000
Rs. 10 50000

Rs. 6 30000
1725350

t 345070
2070420
 COST SHEET: ABSORPTION COSTING

Per Unit Cost

Components Descripition Per Unit Consumption
Rate
Fabric
Shell denim twill fabric 2.3 mts Rs. 130/mt
Pocket interlining cotton 0.3 mt Rs. 35/mt
Waistband interlining polycotton 0.05 mt Rs.45/mt
Trims
Button copper metal button 1 Rs.0.90
Rivets copper rivets 6 Rs. 0.30
Size label back, below waistband 1 Rs. 0.20
Care label left front, below waistband 1 Rs. 0.40
Brand label sticker back side, right, leather 1 Rs.2
Zipper metal sliding zipper 1 Rs 10
Thread yellow color, 3 ply 2 bobbibs Rs. 5
Direct Labor
CMT cut, make, trim
TOTAL DIRECT COST
Overheads
Electricity Rs. 35/hr * 8* 2* 40
Indirect labour cost Rs. 500 * 14 * 40
Margin at 20% of total direct cost
Rent Rs. 200000 + 200000/3
Employee insurance Rs. 50000 * 48 * 40/ 365
TOTAL INDIRECT COST

profit= 30% of total raw material cost= 30% of (1725350-30000)=Rs. 508605

Price= 1725350 + 1177150 + 508605 = Rs. 3411105
price per unit = 3411105/5000=Rs. 682.20
Per Unit Cost
Cost for 5000 units
Price/unit

Rs. 299 1495000

Rs. 10.5 52500
Rs. 2.25 11250

Rs. 0.90 4500

Rs. 1.80 9000
Rs. 0.21 1050
Rs. 0.41 2050
Rs.3 15000
Rs 11 55000
Rs. 10 50000

Rs. 6 30000
1725350

22,400
280000
345070
266670
263010
1177150
 COST SHEET: Activity Based Costing (ABC)
Cost driver: labor
Budgeted Days: 40
Budgeted hours: 40*8*2 = 640 hrs.

Labor cost-source No of employees Rate/ hour budgeted hours

Management 3 salaried(30000 p.m.)
Departmental Heads
Cutting 1 salaried(27000 p.m.)
Sewing 1 salaried(27000 p.m.)
Shipping 1 salaried(27000 p.m.)
Supervisors
Line 1 1 salaried (25000 p.m.)
Line 2 1 salaried (25000 p.m.)
Line 3 1 salaried (25000 p.m.)
Other Indirect Labor
Mechanic 2 Rs. 30 640
Sweeper 4 Rs. 25 640
Chaiwala 3 Rs. 25 640
Inspector 3 Rs. 100 160
Pattern Maker 2 Rs. 100 10
Office Clerk 2 Rs. 90 640
Quality checker 2 Rs. 120 40
TOTAL INDIRECT LABOR COST
Direct Labor
Cutting 12 Rs. 45 32
Sewing 40 Rs. 45 560
Shipping 10 Rs 45 48
TOTAL DIRECT COST

Total cost = direct cost + indirect cost = 1700100

per garment cost = 1700100/5000=Rs. 340
Total wages for 40 days
120000

36000
36000
36000

33340
33340
33340

38400
64000
48000
48000
2000
115200
9600
653220

17280
1008000
21600
1046880