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Process Costing Software



What is Process Costing?



Process costing tracks total cost and unit cost for process-based manufacturers. Estimating cost based on batches revolves around allocating direct and indirect costs to each item or batch. To calculate cost, pricing is methodically allocated per batch, then divided by the total number of units produced in that batch.

SFR ERP Software

ERP Software. Browser based cloud technology.

Designed for companies that manufacture homogeneous products through a continuous process, Process Control software allows companies to pinpoint cost and compare cost estimates to actual costs. Discrete manufacturers, often referred to as “Job shops”, can use Job Costing Software which functions similarly to Process Costing software, but with important structural differences.


Benefits of Process Costing



Process Costing software would be beneficial in the following circumstances:

  • When manufacturing products in batches, yet selling them as units, or pallets (motors, boxes of components, vehicles, etc).
  • WIP items need a cost. Materials that are not completely through a process (e.g. chemicals, rolled goods) require a value, process costing software allows for this. Calculating the cost the unit has incurred such as labor, materials and overhead an "WIP unit" similiar to the value of a finished process can be determined.
  • When manufacturing thousands of items per week, small price changes, even fractions of a penny per unit can drastically impact profitability. Process Costing software allows for projections based on price changes.
  • The company requires cost control during the manufacturing process. Process costing software gives management real-time data allowing them to compare product costs from one period of time to the next. This allows companies to constrain costs in coordination with budget constraints.


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