The Batching Method Of Cost Calculation Is Very Important For Accounting Treatment.

The method of calculating the total cost and unit cost of each batch of products is also called the costing calculation method.

Under the batching method, the costing period is consistent with the production cycle. It belongs to the product cost method of irregular calculation.

This method is suitable for single, small batch and multi variety production types.

Under this method, there are two ways to determine the cost object (or batch). One is to organize production directly and in batches according to the order of the customer. The other is to organize production according to the order of the enterprise in batches according to the order of the customer and the specific conditions of the production and operation of the enterprise.

In the above two cases, production is done in batches, and the batch is very small. Therefore, the product cost calculation can be set according to each batch as the object of cost calculation, and the product cost ledger is set up.

Calculate the cost of the product.

In batches, raw materials, production workers' wages and employee welfare benefits directly consumed by each batch of products are usually recorded directly in the direct materials and direct labor cost items in the cost ledger, according to the original voucher or element cost allocation form, as well as other expenses occurring in the workshop (such as indirect consumption materials, management salaries, etc.).

The cost of repairs, etc., is generally collected by different workshops, which are recorded in the annual manufacturing expense accounts.

At the end of the month

After allocation, it will be credited to the manufacturing cost and cost items of the relevant subsidiary ledger.

Due to the different production periods of batch method, a batch of products will be put into production at the same time and completed at the same time.

Therefore, before a batch of products are completed, the cost of production is the cost of this batch of products. When all the products are completed, the cost of production is the total cost of the product. The unit cost can be calculated by dividing the total cost by the total cost.

Sometimes a batch of products will be completed over a month and will be sold externally. In this case, the finished products will be accounted for according to the planned cost or estimated cost. After the whole product is completed, the actual cost of the products will be re calculated.