Fashion Accessory Cost

Components

DIRECT MANUFACTURERING
DIRECT LABOR
MATERIAL OVERHEAD
Direct material

direct material costs are the

costs of raw materials or parts
that go directly into producing
products.
For Example:

If Company A is a bracelet

manufacturer, a direct
material cost of the company
would be the strings being used
to make the bracelet.
Direct labor

are the cost of wages,

benefits, and insurance that
are paid to the employees who
are directly involved in
manufacturing and producing
the goods.
For Example

workers on the assembly

line or those who use the
machinery to make the
products.
 Manufacturing overhead

include direct factory-related

costs that are incurred when
producing a product, such as the
cost to operate the machinery.
Manufacturing overhead costs also
include some indirect costs, such
as the following: MATERIAL
INDIRECT INDIRECT
LABOR
Indirect materials

are materials that used in the

production process but that are not
directly traceable to the product.
For example, glue, oil, tape, cleaning
supplies, etc.
Indirect labor

isthe labor of those who are not

directly involved in the production of
the products.
For example, security guards,
supervisors, and quality assurance
workers.
 Product Costs Period Costs

 Costs incurred to  Costs that are not

manufacture a product incurred to manufacture a
product and, therefore,
cannot be assigned to the
 Manufacturing and product
production costs
 Non-manufacturing costs

 Raw material, wages on

labor, production
 Marketing costs, sales
overheads, rent on the costs, audit fees, rent on
factory, etc. the office building, etc.
 Example of a Product Costs
 Company A is a manufacturer of bracelet. Its product costs may
include:

 Direct material: The cost of strings, beads, and closure buttons

used to create the bracelets.
 Direct labor: The cost of wages and benefits for the makers of
the bracelet to create the bracelets.
 Manufacturing overhead (indirect material): The cost of the
cardboard used to hold the strings (yarn or embroidery floss)
together.
 Manufacturing overhead (indirect labor): The cost of wages
and benefits for the security guards to overlook the workplace.
 Company A produced 4 bracelets. To produce 4 bracelets,
the company incurred costs of:

 (your receipt) on yarn and embroidery floss

 (desired amount will do) on wages for makers and (desired

amount will do) on wages for security guards to overlook
the workplace

 (an approximate price for the equipment) for a cardboard

to hold the rope-string firmly.
For further understanding of Product
and Period Cost:
 ACTIVITY # 1
GUIDELINES
ON YOUR MODULE ITS ON PAGES 13 - 14
INSTRUCTION
 On you module, please write the following details as it
follows.
(The activity on your module will be your rough sketch)
 After that, once that you have inputted all of the
necessary information. Please take a picture and submit it
in our Facebook Group.
(Once that I have posted a GO signal you can now post it
there)
 After that I’ve checked your work, you may transfer it to
MS Word.
(Save As PDF)
 On the day of the Exam will be the of the submission of
your PDF.
Project/Product Title:
Goals:
1.
2.
3.
 Product Illustration:
Tools and Equipment:
1. ______________________________________________________________________
2. ______________________________________________________________________
3. ______________________________________________________________________
4. ______________________________________________________________________
5. ______________________________________________________________________
6. ______________________________________________________________________
7. ______________________________________________________________________
8. ______________________________________________________________________
9. ______________________________________________________________________
10. ______________________________________________________________________
Materials:

MATERIALS QUANTITY DESCRIPTION UNIT COST TOTAL COST

Cost Components:
PRODUCT COST PERIOD COST EXPECTED PROFIT

Procedure:
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SWOT ANALISIS:
Recommendations: 

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