what are the weaving cost formulas?
Answers
Answer:
There is an example given below
Explanation:
A company developed single jersey cotton fabric for the kids wear garment. The company sourced 2000 kg of yarn and the price of the yarn is Tk. 240 / kg. The knitting industry works with 5 weft knitting machine with the production capacity of 85 kg / machine. The average waste percentage expected during the operation is 3%. The company works with 5 operators and 2 helpers with the wage of Tk. 250 and Tk. 150 per shift, respectively. Calculate the cost of knitting process per kilogram with 20% profit if the company spends Tk. 5000 / month for rent, Tk. 3000 / month for electricity and Tk.15,000 / month as other expenses. Assume company works 26 days per month.
Solution:
Step 1: Number of shifts required to complete the order.
Total production per day = Average machine production × Number of machines
= 85 × 5 = 425 kg / shift
The wastage percentage expected = 3%
Hence, 2000 kg – (3% of 2000 kg) = the original quantity produced
= 2000 – (2000 x 3/100)
= 1940 kg
Total yarn quantity
Total number of shifts required = ----------------------------------------------------------
Production capacity per shift
2000
= ---------------
425
= 4.7 shifts
Step 2: Calculate total labour cost
The labour cost = No. of labours × No. of shifts worked to complete order × Wages/shift
= Cost of operators + Cost of helpers
= (5 ×4.7× 250) + (2 ×4.7× 150) = Tk. 5875 + Tk.1410 = Tk. 7285
Step 3: Calculation of direct material cost
Yarn purchased = 2000 kg with the price of Tk. 240 / kg
= 2000 × 240 = Tk. 4,80,000
Step 4: Calculation of overheads
Company spends all these overheads per month (26 days). Since, the company works one shift per day, The 1 day or 1 shift expense as overhead is as follows,
5000 + 3000 + 15,000
Overheads = ----------------------------------------
26
= Tk. 884.61
Since, the company works 4.7 shifts for this order,
= 884.61 × 4.7 shifts = Tk. 4157.69
Step 5: The overall cost of the knitting process
Material cost + Labour cost + Overheads
The total knitted fabric cost / kg = --------------------------------------------------------------------------
Total production
4,80,000 + 7285 + 4157.69
Fabric cost / kg = ----------------------------------------
1940
= Tk. 253.32
Labour cost Overheads
Knitting cost / kg = ----------------------------------
Total production
7285 + 4157.69
= -------------------------------
1940
= Tk. 5.89
Knitting rate / kg = 5.89 × 20% profit= 5.89 + (5.89× 20/100) = Tk. 7.07
Answer:
Answer:There is an example given belowExplanation:A company developed single jersey cotton fabric for the kids wear garment. The company sourced 2000 kg ...