The general objective of the research is to establish and apply a procedure to calculate and record the standard costs for each of the productions of the Dolz de Cienfuegos candy store.
The results of this research allow us to calculate and record the standard costs for productions, through the establishment of physical standards and prices for material and human resources; separate indirect cost quotas are used for variable costs and for fixed costs; analysis of costs by items is carried out; Variations are calculated and recorded, based on a set of statistical methods, procedures and tools, decision-making and business management that also facilitated the validation of the model.
The introduction of the research has a notable economic impact, given by the reduction of costs for better distribution thereof to a Total: 1,377.60 CUP.
Introduction
The task of making decisions constitutes the daily activity that involves the need to evaluate options and choose, among all, the one that best suits the objectives pursued.
There is no doubt that aspects such as strategic situations, cost control, logistical problems, energy supply, financial planning, human resources policies, health coverage and workplace accidents, market evaluations, business acquisitions, reorganizations, pricing, administration of operations, selection of investments, improvement of productivity, achievement of quality measures, allocation of resources, risk treatment, distribution mechanisms, feasibility of export or import or selection of technologies, are some of the cornerstones of a company or organization that Every day they catch the attention of managers and decisions.
An important point to achieve the efficiency of companies is the adequate control of costs, for this, cost valuation techniques are used, among which are the techniques based on the use of real costs and those based on the use of predetermined costs and within these standards. The foundations of business improvement recognize that the latter "… constitutes the most advanced technique of predetermined costs…" thus demonstrating its great importance.
In socialist society, costs are a work tool that allows controlling and analyzing production, in order to make full use of resources, increasing productivity and thus the production of consumer goods, in order to satisfy the growing needs of society.
Costs are therefore a very important entity, since they are a management tool in large, medium and small companies, as far as decision-making is concerned.
Currently, many business organizations have difficulties in estimating and controlling their future operations, as well as the future costs that the entity will incur, others do not have feasible procedures for updating their cost sheets, by recalculating the standard cost of productions, which means that on many occasions it cannot be used reliably for cost control purposes, that is, that it enables periodic comparisons of real costs with standard costs to measure performance and correct inefficiencies.
In Cuba, there are the General Cost Guidelines that nationally define the bases that must be considered when preparing the Branch Guidelines for what constitutes a governing document.
In the elaboration of the Branch Guidelines, the governing union must consider the characteristics of the activities that are carried out in the companies of the branch, which will facilitate the general indications that each entity must take into consideration when preparing its cost system.
When a standard cost system is used, physical patterns and prices are established for material and human resources; separate indirect cost quotas are used for variable costs and for fixed costs; analysis of costs by items is carried out; Variations are calculated and recorded.
Currently, at the Dulz Dolcería in the province of Cienfuegos, the need to implement standard cost systems for their productions is understood, based on the achievement of business efficiency.
This leads us to raise the following:
Scientific Problem: The Dolz Candy Store does not determine the standard cost of each of its productions.
Hypothesis:
The design and application of the procedure in the Dulz Dolz de Cienfuegos for calculating the cost of productions from standards, will allow management to know the cost of each of their productions, while being an ideal tool for taking of decisions.
General objective:
Establish and apply a procedure to calculate and record the standard costs for each of the productions of Dulceria Dolz de Cienfuegos.
Specific objectives:
- Present the procedure to be applied to determine the standard costs. Determine the price and efficiency standard of direct material. Determine the price and efficiency standard of direct labor. Determine the application rate of indirect production costs. Variations in cost elements. Validate the proposed procedure.
Development
The present investigation proposes a procedure capable of calculating the cost of each production before it has been executed and which are made on more technical bases in their calculation, being more exact than the estimated costs. Allowing control and analysis of production, in order to go to the full use of resources, increasing productivity and thus the production of consumer goods, in order to meet the growing needs of society.
Taking as a reference the conceptions of Polimeni (1994) (1), we proceed to elaborate the proposal of the procedure which consists of four fundamental stages, which will later be broken down into their corresponding steps in order to understand the logical sequence of the procedure.
Stage 1. Characterization of the productions: This is carried out with the aim of carrying out a preliminary analysis of the productions, using expert criteria, determining in turn the main goods used in production and transformed into articles. finished with the addition of direct labor and indirect production costs, then they will be classified as direct and indirect. Finally, all indirect costs incurred in production, including indirect materials and indirect labor, will be classified into fixed and variable. (two)
Stage 2. Establishment of the standards: Firstly, all the information necessary for the establishment of the standards will be collected, with the help of the experts selected in the previous stage. Then the standards are established by cost elements for each of the productions, both in price and in efficiency. (3)
Stage 3. Determination of the Standard Cost: The standard cost for each of the elements of the cost of a product is determined, for which the following formula (4) will be taken into account:
Total standard costs = Quantity standard x Price standard
Stage 4. Preparation of the Standard Cost Sheet: This stage allows you to predetermine the results of each product to be produced, control the resources used and establish the sale price of the products. (5)
Stage 5. Calculation of Variations: In it it is proposed to continue the discussion about standard costing focused on the calculation and analysis of variations, the price and efficiency analysis will be performed for each cost element. (6)
Stage 6. Accounting for variations. Presenting journal entries under a standard cost system will begin with direct materials, continue with direct labor, and end with indirect production costs. (7)
Results
After each expert selects the characteristics for which they consider to meet the requirements for it and the sources of their knowledge, a score greater than 80% is obtained, therefore, they can be endorsed as experts. Those who classify each material, labor and indirect production costs that directly and indirectly intervene in production.
Following the procedure outlined, calculations of the standards are made for the different Raw Materials that were classified as direct, according to the classification: National Flour, Sugar, Eggs, Oil. Showing the calculations of the standard cost in one of its productions and in a single direct material:
Kake of 5 175 g you get:
National flour.
National Flour Price Standard:
Taking into account the expert criteria, the standard price per Kg of Flour and the quantity of Kg of Flour for 12 kakes are obtained.
The price per Kg of Flour consumed total is determined given by multiplying the price of 1 Kg of Flour by the amount of Kg of Flour for a batch of 12 Kakes.
Price per Kg. Of Flour consumed total = $ 0.58020 x 14,775Kg.
Price per Kg. Of Flour consumed total = 8.572455 $ / Kg.
Then the price per unit of Flour is calculated, which is obtained by the ratio of the price per Kg of total consumed flour and the multiplication of the weight in Kg of a unit by the quantity of Kg of the batch. Taking into account the conversion rules so 1Kg. = 1000g
Therefore: 5 175 g is equivalent to 5,175kg. To bring everything to the same unit of measurements.
It is obtained that: Flour Price Standard = 0.138043 $ / u
National Flour Efficiency Standard:
To calculate the Efficiency Standard, the amount of total Kg of National Flour and the number of units are taken into account.
Thus, it is obtained that: National Flour Efficiency Standard = 1.2313 Kg./u
From here, the data will be searched in the same way and calculated with the formulas following the procedure previously designed to find the standard costs.
In the same way, the labor involved in the production is classified, where it is obtained as direct: Master Dulcero, Hornero, Operator A, Assistant Operator, Assistant.
We will look for the total number of hours worked by each worker, which is obtained by measuring the time in all the production processes in which the Sweet Master intervenes in this case and multiplies it by the number of times the product is made at day to obtain the number of hours per day that the sweet master works, a result that yielded 4.9660 h. Then it will be multiplied by the master candy maker's hourly wage ($ 1.57) to obtain the master candy maker's expected daily hourly wage = $ 7.2913 / hr, dividing at once by the number of units produced, where Kakes salary per unit produced = $ 0.1823 / h. Result that will have to be divided by two to know the price standard $ / h, because there are two production shifts, thus it is obtained that:
Candy Master's Price Standard = $ 0.091 / h
Master Dulcero's Efficiency Standard:
To calculate the Efficiency Standard, the hours worked daily by Master Dulcero and the number of units produced daily are taken into account. Division that determines the Master Dulcero's efficiency standard = 0.1241 h / u.
Then it will have to be divided by 2 to see how much efficiency corresponds to each worker on each shift.
Master Dulcero Efficiency Standard = 0.062 h / u
Indirect production costs should be allocated based on the number of productions. The allocation of indirect production costs is calculated by dividing the total indirect cost based on the number of productions.
According to the analysis of the variations it was obtained:
The variation in the price of direct materials for the Dolz candy store was zero, as there was no difference between the real price per unit and the standard price per unit of direct materials.
The variation efficiency of direct materials, in the case of the kake of 1 517g, results in a favorable variation with two of its direct materials: national flour and eggs of -0.00329 and -73.79 respectively. This means that 0.00329kg less of national flour and 74 eggs less than the amount established in the month analyzed are used to make said production. The opposite case occurs with sugar because there is an unfavorable variation that means that the Dolz candy store used 0.00887kg more than allowed in the production of 447 kakes (real production).
There was no variation in the price of direct labor as there was an equality between real wages and standard hourly wages for direct labor.
In the analysis of the variation in the efficiency of direct labor, a result of an unfavorable variation was obtained due to the fact that the Dolz Dulcería used more hours of Direct Labor than the standard direct labor hours allowed in production for a unit of all its products, resulting from the increase in the cost of direct labor in the finished product.
For the analysis of the variations of the indirect production costs we will use the method of the analysis of three variations of indirect manufacturing cost.
Price variation (expense). In the case of the Kake, energy shows an unfavorable variation ($ 1.04) because the CIP actually incurred exceeded the budgeted amount that will have to be spent based on daily productions. In the cases of Water and Diesel, they presented a favorable variation of $ 10.4 and $ 0.36 respectively.
Efficiency variation. A favorable variation is seen in all products, except for Mantecado of 60 g, as the actual productions exceeded the permitted standards.
Variation of production volume. When analyzing the variation in production volume, the same behavior described above can be seen: Mantecado presented an unfavorable variation of $ 66.38.
The presentation of the journal entries will begin with direct materials, continue with direct labor, and end with indirect production costs.
In the 5 175g Kake the variations are small and insignificant so it should be charged directly to period costs, as inventory is being shown at standard cost. (8)
The seats are shown below:
Conclusions
1. The standard cost provides efficiency measurement mechanisms, establishes deviations from the predetermined versus the executed. Facilitates performance evaluation, as well as provides corrective measures tailored to the organization's plans.
2. The knowledge of the workers and especially of the senior management on the possibilities offered by the calculation of the standard cost, is of special attention in each of the organizations that are going to apply this system.
3. The procedure is designed under the premises of the achievable standard cost, which are based on a high degree of efficiency.
4. The application of the procedure requires the participation of a large part of the organization based on the establishment of standards.
5. There are no price variations in direct materials and direct labor, since the real price and the standard price remained constant in the period analyzed.
recommendations
• Analyze the advantages of establishing achievable standards.
• Organize, together with the universities, training courses to deepen the possibilities offered by the standard cost, committing all workers and especially senior management.
• Provide knowledge, information, and acquired experiences to other candy stores in the province belonging to the Food Industry in order to obtain good feedback.
• Enrich the current information system by creating new records that allow working with standards.
• Explore the standards determined for the preparation of the operating budget for the next period.
• For any price variation, take into account the standard costs established in the investigation.
• Manage suppliers that offer raw materials at a lower price.
• Carry out cut studies to minimize production waste.
• Carry out time studies in order to make better use of the working day.
Bibliographic references
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