Variable costs

  • Manual labor costs: The amount of workers can vary depending on the production volume foreseen in the month.
  • Monthly costs of prime materials and products: The cost of this also varies depending on the production:
  • Calculate the amount of prime materials needed for 10 kilograms of gummies.
  • Calculate the total costs of 1000 kilograms of gummies a month.

Let’s say that you will need three workers that will have a cost of $120 each. In other words, $360 in manual labor costs.

Then multiply your other costs by 7. This way you will be able to calculate the necessary amounts to produce 350 liters.

Then multiply the unitary cost of each product by the quantities obtained.

Don’t forget to get the real costs in your location before making calculations.

Fixed costs

Depreciation costs: The equipment you will be using will go losing value with time, this is why it will be necessary to separate an amount of money to be able to replace them when they break down or deteriorate. These costs are calculated by dividing the price of each active between its life span and dividing the result between 12. This means that you will need to separate a certain amount every month to be able to repair the equipment and deteriorated materials.

 

Desserts Recipes Variable costs Determining the sales costs

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