Product Costing for Manufacturers

As a manufacturer, you likely know what your material and labor costs are, and price your products to appropriately capture them. But are equipment and overhead accurately factored in to your prices? If you are basing these costs on labor hours/dollars or equipment time, then maybe not.

Getting a firm grasp on your true costs not only helps ensure you are pricing products profitably, but also serves as a decision tool, identifying your most profitable areas of the business. To help ensure your pricing fully captures your costs, Doeren Mayhew’s manufacturing accounting professionals offers product costing for manufacturers.

Product Costing Process

During our product costing analysis, our specialists will:

• Observe and gain an understanding of your manufacturing process
• Review historical financial information
• Look at your manufacturing accounting software to understand how costs are accumulated
• Check the core assumptions in your system to ensure they are current and accurate
• Walk through and gain an understanding of your estimating process in order to ensure your estimating system aligns with how costs are rolled into your manufacturing accounting system
• The process will result in a report outlining issues discovered and recommendations for resolving them.

The process will result in a report outlining issues discovered and recommendations for resolving them.

Signs You Need Product Costing

Wondering if you should be considering product costing? Our manufacturing accounting professionals offer seven signs you need a product costing analysis.