This article throws light upon the top twelve industry-wise features of cost statements. The features are: 1. Jute Goods 2. Paper 3. Dyes 4. Rayon 5. Nylon 6. Polyester 7. Dry Cell Batteries 8. Steel Tubes and Pipes 9. Engineering Goods 10. Electrical Cables 11. Motor Vehicles 12. Chemical Industries.
Industry-Wise Feature # 1. Jute Goods:
Cost statements should be for all types of jute goods by sizes, specifications and descriptions. Where it is not possible to give for all products, cost statements should be made for items which form 5% or more of the annual production representing the different jute goods like sacking, hessian, carpet backing, twine, decorative fabrics etc.
On an overall basis, not less than 75% of the total production/sales is to be covered by including the individual items even forming less than 5% if necessary. Separate cost statements should be prepared in respect of special jute products like laminated bags, carpets, felt, bleached and dyed jute fabrics.
Industry-Wise Feature # 2. Paper:
Separate cost statements are necessary in respect of different types of paper manufactured—paper and paper board as prescribed by the DGTD. Separate statement is required to be maintained for each type and description, viz. printing paper (white/coloured), imitation art paper, cream laid/wove paper, cheque paper, writing/packing/wrapping paper and other varieties of paper and paper board.
Cost statement shall be prepared for major and sub product code for paper and paper board of various densities (GSM Gramme per Square metre). In case it is not possible for each density separately, they could be grouped together in groups of 20 GSM i.e. 1-20, 21-40, and so on.
Industry-Wise Feature # 3. Dyes:
Cost statement shall be prepared for each type of dye. Detailed Cost Sheets are to be made out in respect of major items of Dyes falling under specified classification/specification, colour index, trade name and constituting not less than 80% of the total production/sales of the company in a particular year either in terms of quantity or value.
In respect of other Dyes manufactured detailed cost sheets are to be maintained for the purpose of overall reconciliation. Group cost sheets in respect of the Dyes falling under each group are to be made out so that total cost of production can be reconciled with the financial accounts.
Industry-Wise Feature # 4. Rayon:
The cost statements for Viscose Filament yarn should be prepared separately for each quality and denier. Where it cannot be collected denier-wise, the total cost can be distributed between different deniers based on the length of production of each denier by adopting appropriate weight and length conversion ratios.
For Viscose Staple Fibre produced under two different processes like slurry and steeping process, separate cost sheets are to be maintained for each process and for each quality such as coloured staple fibre, staple fibre for tops and for filter tips etc.
Separate cost statements are also necessary for:
(a) Acetate Yarn/Fibre for different qualities and denier, and
(b) Viscose Tyre Yarn for different qualities like Super I and Super II.
Sales realisation should include details such as:
(a) Sales to actual users,
(b) Sales to exporters,
(c) Sales as per Textile commissioner’s order,
(d) Sales as per voluntary agreement with weavers, and
(e) Sales under free sale price.
Industry-Wise Feature # 5. Nylon:
Separate cost statements should be prepared for Nylon chips. Nylon yarn, Nylon tyre fabric and polyester filament yarn. Separate cost statements are necessary for extrusion and grid processes. Separate cost statement should be prepared for each quality of Nylon. Moreover, separate cost statements are to be prepared for each quality of tyre yarn, tyre cord and fabric.
Industry-Wise Feature # 6. Polyester:
Separate cost statements should be prepared for different qualities of polyester chips, polyester fibre, and polyester filament yarn of each quality and denier.
Industry-Wise Feature # 7. Dry Cell Batteries:
Cost statements should be prepared separately for different types and sizes of batteries and also for different modes of manufacture (partly manual, or automatic). Cost Statements in proformae ‘C’ and ‘D’ shall be separately maintained for production under automatic lines.
Such cost statements shall also be maintained separately in respect of each size of dry cell batteries corresponding with international standards like IR-20, IR-14, IR-6 as well as for different types like paper clad, metal, clad and cellulose acetate batteries, flat cells, layer cells and inert cells of different specifications.
Industry-Wise Feature # 8. Steel Tubes and Pipes:
Statements of conversion cost separately for each operation cost centre and for different sizes, shapes and quality of steel tubes and pipes, black or galvanized, screwed or coupled, should be prepared. The compilation of data for all types and sizes of pipes and tubes for the purposes of Proformae D and F, if not possible, is to be done for the items which are predominantly produced.
This data on an overall basis should cover more than 80% of the total value of production (quantity × average sale price) provided that no item constituting not less than 5% of the production value is excluded. The same data regarding the rest of the categories produced should be given in total in the above-mentioned proformae for the purpose of reconciliation required as per Proforma G.
Industry-Wise Feature # 9. Engineering Goods:
When the product is being progressively indigenized, cost of production shall be worked out separately for each stage of major deletion till deletion reaches 90%. Cost statements separately for the classes of products are to be prepared.
Industry-Wise Feature # 10. Electrical Cables:
Cost statements should be made out for each size and type of electrical cables, conductors, wires or strips under each listed category and corresponding to different specifications. In case it is difficult to compile such data, the cost of production and cost of sales should be maintained under each category which are predominant on an overall basis, so as to cover at least 80% of the total value of production (quantity × average sale price) of electrical items provided that no item constituting not less than 5% of the production value is excluded for the purpose of maintaining Proformae A to H.
For this purpose, a basic cost sheet for a representative size in each category is to be maintained and the differential cost by elements, mainly direct material cost (separately for major items of material), conversion cost, packing cost in respect of other sizes included in the category is to be indicated, provided that the differential cost is not at variance by more than 5% as compared to the representative size.
Another striking feature is that the statements of conversion cost centre wise and their allocation to various specifications etc. for each category should be made out on the basis of the total cost recovery rate per unit (where unit for recovery for each cost centre takes into account weight-age factor of process time involved for each size/type of items).
Industry-Wise Feature # 11. Motor Vehicles:
Cost statements separately for:
(a) Each item of components produced, and
(b) Each type and model of motor vehicles.
The statements are to be compiled separately for each stage of major deletion till such time the manufacturer has reached deletion of 90%.
Industry-Wise Feature # 12. Chemical Industries:
If the chemical goods are produced in batches, separate cost statements should be prepared in respect of each batch, in addition to the other prescribed costing proforma.