Calculate variable costs for the balance sheet. Fixed costs. Ways to reduce costs

You will need

• - Data on the volume of manufactured products in natural units
• - Data accounting on the costs of materials and components, equipment wages, fuel energy resources over a period.

Instructions

Based on documents on the write-off of raw materials and materials, acts on the performance of production work or services performed by auxiliary units or outside organizations, determine the amount for production or services for. Exclude the amount of returnable waste from material costs.

Determine the amount of labor costs, which consists of piecework and time wages of production workers and service personnel, bonuses, allowances and surcharges, contributions to funds social insurance.

Determine the amount of costs for electricity, water and fuel used for technological needs, based on the data of actual consumption and purchase price.

Determine the amount of transportation and procurement costs and the cost of packaging products.

Adding all the above amounts, you will determine the total variable costs for all products produced for the period. Knowing the number of items produced, by dividing, find the sum of the variable costs per unit of output. Calculate the critical level of variable costs per unit of production using the formula P – PZ / V, where P is the price of production, PZ is fixed costs, V is the volume of products produced in natural units.

note

In terms of taxes, fees, and other mandatory payments, the amount of which depends on the volume of production, a decrease in variable costs is possible only when the legislative framework.

Useful advice

A decrease in variable costs will lead to an increase in labor productivity, a decrease in the number of employees in the main and auxiliary industries, a decrease in the stock of raw materials and finished products, an economical use of materials, the use of energy-saving technological processes, the introduction of progressive management schemes.

Sources:

• A practical journal for an accountant.
• what costs are not variable
• v - variable costs per unit of production, DE

Variable costs of the enterprise include costs that change when the volume of products changes. They are characterized by the fact that they disappear when production stops. How do you determine their size?

You will need

• - calculator;
• - computer.

Instructions

Calculate the cost of materials for the production of one product. To do this, it is necessary to multiply the price for 1 kg of materials used in the manufacture of products by the weight of the product and by the utilization rate of the material. The utilization factor of the material is equal to the ratio of the mass of the product to the rate of consumption of material for the manufacture of products. The resulting value is multiplied by the rate of transportation and procurement costs, divided by 100 plus one. All these indicators are taken from the accounting reports of the company. Calculate the total cost of materials for the production of products for the billing period.

Calculate labor costs for production workers. Calculate a rate for each employee for the operation to be performed. To do this, multiply the employee's hourly wage rate by the time it takes to complete the job for production. Sum up all the values ​​obtained, add the bonuses paid to them and get the labor costs of production workers.

Calculate the social security contributions for your employees. This indicator is equal to the cost of wages of employees, multiplied by the rate of deductions for social needs. The rate of deductions is established by law. Since this indicator is expressed as a percentage, the resulting value after multiplication must be divided by 100.

Add up the business expenses that the business spent on manufacturing the product. Costs for electricity, fuel and water should be accounted for based on actual consumption and purchase price. Add packaging and shipping costs to your selling expenses.

Sum up all the obtained indicators and get the variable costs of the enterprise for the manufactured products for reporting period... Divide the resulting value by the number of products manufactured during this period. As a result, you get variable costs per unit of output.

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In conditions economic market analysis financial condition the enterprise takes on special significance. This is due to the fact that management decisions determine its results. At the same time, one of the simplest methods of financial analysis of operational or strategic planning is an operational analysis that traces the dependence financial results firms on costs, as well as production volumes. To perform this analysis, you need to subdivide all costs into variable and fixed.

Instructions

Fixed costs include rent, property taxes, management personnel, security. At the same time, fixed costs are constant only for the purposes of short-term analysis, because in the long term they change due to, for example, changes in the size of the company, financial agreements, insurance and rental.

Since fixed costs do not depend on volume, the share of fixed costs in the cost of each unit of a product (goods) will decrease with an increase in volume and increase with a decrease in volume. In turn, this leads to a decrease or an increase in value. For a certain volume, which is called the break-even point, the cost per unit of output may become such that the proceeds can only cover costs.

When using the linear method or the method of diminishing balance, you can calculate fixed costs as follows: write-off of value by the sum of the number of years of useful life. That is, the rate of fixed costs in this case is equal to the sum of all depreciation charges made for fixed assets.

In production costs, fixed costs are divided into two groups: fixed costs, which are determined by capacity, and control costs. In turn, the fixed costs of the first group are determined by the fixed costs of all costs incurred for redistribution, and management costs are determined by the general business costs of the enterprise.

You can also find fixed costs if you derive this measure from a formula where revenue = fixed costs minus variable (total) costs. The result is that fixed costs = revenue plus variable (total costs).

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The value of variable costs varies in proportion to the volume of products produced. The opposite of variable costs are direct ones, which add up to total costs. When production stops, the amount of costs is reduced precisely by the number of variable costs.

Instructions

IFRS standards require two types of variables to be considered: production direct and. To direct variable costs include those that are directly transferred to the cost of goods, products. Indirect variable costs - costs that do not affect the cost of production, but are directly related to production. Indirect variable costs are impractical to write off directly to the cost of production.

All costs associated with the purchase of raw materials, materials, equipment for the manufacture of a particular product, the cost of electricity, fuel, labor costs directly related to production, refer to direct variable costs in production.

Write off the costs in complex production for the processing of materials and raw materials as indirect costs. Examples of such costs can be processing of coal, from which gas, coke and other products are obtained; and also during milk processing, skim milk and cream are produced by separation.

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note

Keep in mind that variable costs are not always proportional to the quantity produced. It so happens that with an increase in output by 15%, costs increase by only 10%, or vice versa, an increase in output by 10% entails an increase in variable costs by 15%.

Useful advice

Consulting companies, according to Art. 318 of the Tax Code of the Russian Federation, has the right to independently determine which costs are considered indirect and which are direct, but sometimes doing only indirectly, organizations violate the Tax Law, which states that cost sharing must necessarily take place in an organization.

Sources:

• ARTICLE 318. PROCEDURE FOR DETERMINING THE AMOUNT OF EXPENSES FOR PRODUCTION AND SALE. RF Tax Code
• Allocation of direct and indirect costs

The organization's production costs imply certain costs that are associated with the production and sale of manufactured goods. In statistical and accounting reports, they are reflected as cost.

Instructions

Calculate the total cost. It can be calculated as the sum of the company's fixed and variable costs. In this case, these costs represent the value of the organization's funds that was spent on the production of products.

Determine the average cost. To do this, you need to divide the total costs by the amount of products produced. These costs are called gross, and the resulting value shows how many of them were "spent" on one manufactured product.

Calculate the economic (imputed) costs of the enterprise. They represent certain economic costs incurred by the organization in the course of its own activities. The composition of these costs includes: resources that were purchased by the company, internal resources of the company and normal profit, considered by the entrepreneur in the form of a certain compensation for risks in business.

Find the value of accounting costs. Such costs mean the amount of cash costs incurred by the company in order to obtain the necessary factors for the normal operation of production on the side. In turn, the value of accounting costs is always less than the value of economic ones. After all, they can only take into account the real costs of purchasing the necessary resources from external counterparties.

In addition, accounting costs are comprised of direct and indirect costs. Direct costs consist of costs that are required for production. But indirect costs consist of all the costs without which the organization itself simply cannot function successfully: depreciation charges, overhead costs, the cost of paying interest to banks.

Determine the opportunity cost. This is all the funds spent on the production of a product that the company will not produce, since it uses these resources in the production of such a product. Thus, the value of opportunity cost is the sum of all costs of lost opportunities. Therefore, in order to find the amount of opportunity cost, it is necessary to subtract from economic costs accounting expenses.

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In the course of economic activity, company leaders spend cash for certain needs. All these costs can be divided into two groups: variable and fixed. The first group includes those costs that depend on the volume of products manufactured or sold, while the latter do not change depending on the volume of production.

Instructions

To determine variable costs, look at their purpose. For example, you purchased any material that goes into the production of products, that is, it directly takes part in the release. Let it be wood from which lumber of various sections is made. The volume of lumber produced will depend on the amount of wood purchased. Such costs are referred to as variables.

In addition to wood, you use electricity, the amount of which also depends on the volume of production (the more you produce, the more you spend), for example, when working with a sawmill. Any costs that you pay to the electricity supplier are also referred to as variable costs.

Probably every person who has worked for the "owner" at least one day wants to own business and be your own boss. But in order to open your own business, which will bring good earnings, you need to correctly set financial model economic activity.

Financial model of the enterprise

What is it for? In order to have a correct idea about future income, about what level the enterprise's fixed and variable expenses will have, to understand where it will be necessary to strive and what financial policy use when making decisions.

Basis of construction successful business is its commercial component. According to economic theory, money is goods that can and should generate new goods. In the case of starting your own business, you need to understand that its profitability should come first, otherwise the person will be engaged in patronage.

You can't work at a loss

Profit is equal to the difference between income and costs, which are divided into fixed and variable costs of the enterprise. In the case when expenses are greater than income, profit is transformed into a loss. The main task the entrepreneur is to make sure that the business brings the maximum income with the minimum use of the available resources.

This means that it is always worth striving to sell as many goods or services as possible, while reducing the level of costs for the enterprise.

If everything is more or less clear with income (how much he made, how much he sold), then with expenses it is much more difficult. In this article, we will look at fixed and variable costs, as well as how to optimize costs and find a middle ground.

In this article, costs, costs and expenses, as well as in the economic literature, will be used as synonyms. So what are the types of costs?

Types of expenses

All costs of the enterprise can be divided into fixed and variable costs. This division allows for the efficient budgeting and planning of the necessary resources for the business of the enterprise.

Fixed costs are those costs, the level of which does not depend on the volume of products produced. That is, no matter how many units of a product you make, your fixed costs will not change.

Variable and nominally fixed costs affect production activities in different ways. Why conditionally permanent? Because not all types of expenses can be attributed to fixed ones, since from time to time they can change their properties and accounting procedure.

What do variable and fixed costs include?

For example, such expenses include the salaries of administrative and managerial personnel, but in the event that they receive money regardless of the financial results of the enterprise. Despite the fact that in the West, managers have long earned on their managerial and organizational qualities, increasing customer base and expanding markets, in most enterprises Russian Federation the heads of various structures receive a stable monthly salary without reference to the results of their work.

This leads to the fact that a person simply does not have an incentive to improve something in his work. Because of this, labor productivity is at a low level, and the desire to move forward to new technological processes is generally at zero.

Fixed costs

In addition to the salaries of managers, rent payments can be attributed to fixed costs. Imagine that you are in the tourism business and do not have your own premises.

In this case, you will be forced to pay someone to rent a commercial property. And no one says that this is the worst case. The cost of building your own office from scratch is very high and in many cases will not pay off even in 5-10 years if the business belongs to the small or middle class.

Therefore, many people prefer to take the necessary square meters as a lease. And you can immediately guess that regardless of whether your business went well or you are in deep loss, the landlord will demand the monthly payment indicated in the contract.

What can be even more stable in accounting than salary payments? This is depreciation. Any fixed asset must be depreciated from month to month until its initial value equals zero.

Methods for calculating depreciation can be different, but, of course, within the framework of the law. These monthly expenses are also referred to the fixed costs of the enterprise.

There are many more such examples: communication services, communications, waste removal or processing, provision of the necessary working conditions, etc. Their main feature is that they are easy to calculate both in the current period and in the future.

Variable costs

Such costs are those that change in direct proportion to the volume of products or services provided.

For example, in the balance sheet item there is such a line as raw materials and materials. They indicate the total cost of those funds that are necessary for the enterprise for production activities.

Suppose you need 2 square meters of wood to produce one wooden box. Accordingly, to create a batch of 100 such units of production, you will need 200 square meters of material. Therefore, such costs can be safely attributed to variables.

Salary can refer not only to fixed, but also to variable costs. This will be the case when:

• the changed volume of production requires a change in the number of employees involved in the manufacturing process;
• workers receive interest that corresponds to the deviations in working norm production.

Under such circumstances, it is rather difficult to plan the amount of labor costs in the long term, since it will depend on at least two factors.

Also, in the process of production activities, fuel and various kinds of energy resources are consumed: electricity, gas, water. If all these resources are used directly in the manufacturing process (for example, the production of a car), then it would be logical that a large batch of products will require an increased amount of energy consumed.

Why do you need to know what are the fixed and variable costs?

Of course, such a classification of costs is needed to optimize the structure of costs in order to increase profits. That is, you can immediately understand at what costs you can save, and what will be in any case, and they can be reduced only if the level of production is reduced. What does the analysis of variable and fixed costs look like?

Let's say you manufacture furniture on an industrial scale. Your cost items are as follows:

• raw materials and supplies;
• wage;
• depreciation;
• light, gas, water;
• other.

So far, everything is easy and understandable.

The first step is to split it all into fixed and variable costs.

Permanent:

1. Salaries of directors, accountants, economists, lawyers.
2. Depreciation deductions.
3. Used Electric Energy for lighting.

Variables include the following.

1. Wages of workers, the standardized number of which depends on the volume of furniture produced (one or two shifts, the number of people in one assembly box, etc.).
2. Raw materials and materials required for the release of one unit of production (wood, metal, fabric, bolts, nuts, screws, etc.).
3. Gas or electricity, if these resources are consumed directly for the manufacture of furniture. For example, this is the consumption of electricity by various furniture collecting machines.

Impact of costs on production costs

So, you have described all the expenses of your business. Now let's see what role fixed and variable costs play in the cost price. It is necessary to sort out all fixed costs and see how the structure of the enterprise can be optimized so that fewer management personnel are involved in the production process.

The composition of fixed and variable costs listed above shows where to start. It is possible to save on energy resources either by switching to alternative sources, or by upgrading, in order to increase the level of equipment efficiency.

After that, it is worth going through all the variable costs, tracking which of them more or less depend on external factors, and which can be calculated with confidence.

Once you understand the cost structure, you can easily transform any business to the needs and requirements of any owner and his strategic plans.

If your goal is to reduce the cost of products in order to win several positions in the sales market, then it is worth paying more attention to variable costs.

Of course, as soon as you understand what is related to fixed and variable costs, you will already be able to easily navigate and quickly understand where you need to "set your tails" and where you can "loose your belts".

Natalia Belorusova,
Leading economist, LLC PVP "Contact"
CFO
No. 10 (98) October 2010

During the analysis of its accounting statements Financiers of PVP "Contact" have found a way to more accurately calculate the variable costs of a trading company. All it took was an official balance sheet and income statement.

The production and implementation enterprise "Contact" specializes in the supply of medical and dental equipment. Branches of the enterprise operate in four cities of the Siberian region.

Despite the fact that the company "Contact" was founded almost 20 years ago, in 1992, a full-fledged financial service was created only three years ago. Now this service includes not only the accounting department, but also the planning and economic department. The main reason for the creation of such a financial unit was the increase in the scale of the business and, as a result, the need to monitor its financial condition.

One of the primary tasks of financiers was the calculation and analysis of indicators such as marginal income, break-even point, as well as determining the achievable business growth *. Interestingly, the company did not keep any management accounting. Therefore, I had to use only accounting data. In particular, limit yourself to the balance sheet and the income statement. Due to the lack of information in the company, a number of problems arose related to the calculation of the previously indicated indicators. As it turned out, due to the peculiarities of accounting, it is impossible to clearly distinguish between fixed and variable costs of the company. Now let's talk about everything in order and in detail - how the company solved the listed problems.

* For more details on the model of achievable growth, see the article "How to align the budget with the company's strategy" (see "Chief Financial Officer" No. 4, 2006). - Approx. ed.

The specifics of accounting for the costs of transportation of goods

Since the main activity of the PVP "Contact" is wholesale, variable costs include the cost of goods and transport and procurement costs, with the correct assessment of which certain difficulties arose. The fact is that these costs could be both attributed to the cost of goods and included in selling costs.

Table 1. Fragment of the profit and loss statement for the month (accounting and management accounting), rub.

Table 2. Deviations of financial indicators when using accounting and management (adjusted) data

In the first case, the delivery of goods is highlighted in a separate line in the consignment note. In accordance with the company's accounting policy, transportation costs are immediately charged to the cost of goods (account 41 "Goods") and automatically become part of the cost of goods (page 021 "Including goods" in the income statement).

But transport costs can be presented in a separate act. For example, if the delivery was provided not by the supplier of the goods, but by some third-party carrier. Such costs are accumulated on account 44 "Sales expenses" and then written off to the expenses of the period in proportion to the volume of goods sold.

Consequently, in the cost of goods reflected in the form No. 2 (profit and loss statement), only part of the transportation costs is taken into account.

Company information

LLC Production and Implementation Enterprise "Contact" was founded in 1992 in Krasnoyarsk. The main activity of the company is wholesale trade in medical equipment, dental equipment, orthopedic products, pharmaceutical and medical products. PVP is one of the largest representatives of Chirana-Dental, Chirana-Medical, EKOM factories, as well as a dealer of Bien-Air, NTI, Medin, etc. The number of employees is 150 people, the turnover is more than 500 million rubles per year. The company has four sales branches. The first is in Abakan (Republic of Khakassia), the second is in Irkutsk (Irkutsk region), the third and fourth are in Achinsk and Lesosibirsk (Krasnoyarsk Territory). The average number of employees in the company is about 150 people.

Technique for determining variable costs

To highlight the amount of variable transport costs, which, due to certain nuances of accounting, fell into the commercial expenses, the production and implementation enterprise "Contact" used the following formula:

Write-off of transportation costs = Balance of transportation costs at the end of the period: Balance of goods at the end of the period x Write-off of goods,

where Remaining transportation costs at the end of the period- this is the debit balance on account 44 "Sales expenses", which in the case of the PVP "Contact" is reflected in the balance sheet (page 213). In some organizations, the balance of account 44 may be reflected in the line "Other stocks and costs" (page 217);

-Balance of goods at the end of the period is the line " Finished products and goods for resale ”of the balance sheet (p. 214). In the case of trading companies, it usually reflects only goods for resale;

-Write-off of goods for the period reflected in the line "Cost of goods sold" (line 021) in the income statement.

Perhaps it is worth warning right away that it is not possible to accurately separate the costs of transporting goods from the commercial expenses, having only annual or quarterly financial statements in hand. And the "Contact" company had to be convinced of this on its own experience. The fact is that the error in the calculations turns out to be too significant. This is especially pronounced in situations when during the year the share of transport costs in the composition of the cost price fluctuates significantly.

Therefore, in such cases, it will be more correct to use the data of the monthly interim financial statements. This is exactly what they did at the Contact PVP.

By the way, with this approach, it will not be difficult to determine the amount of adjustments for the entire year. To do this, it is enough to sum up the previously calculated monthly write-offs of transport costs.

After the write-offs (adjustments) of transportation costs are determined to obtain the correct figures in the income statement, the adjustments are included in the cost of goods sold. And at the same time should be excluded from the commercial expenses. Example

Example

According to the balance sheet, the trading company had a balance of transportation costs at the end of the month of 1,342 rubles, the balance of goods at the end of the period - 106,965 rubles, and the cost of goods sold, which appears in the profit and loss account, was 31,506 rubles.

Accordingly, the amount of the adjustment for transportation costs will be 395 rubles. (1342: 106 965 x 31 506). The income statement before and after the adjustment is presented in table 1 on page 41. Significant changes are visible to the naked eye. The deviation in terms of gross profit reaches almost 6 percent, in terms of marginal profit - more than 9 percent and in terms of financial strength - 8 percent.

What the fixes affected

The discrepancies in financial indicators of accounting and management accounting (before and after adjustments) reached 9 percent. And this despite the fact that often even less significant deviations can give more serious errors in the calculation of indicators that are significant for the management of the company.

In conclusion, it should be said that the methodology for determining variable costs and calculating basic financial indicators used in the Contact PVP may well be adopted by other trading companies. Provided that their variable costs include mainly the cost of the goods and the cost of transportation. This will allow management to operate with more accurate data in their work.

The variety of ways to make a profit for enterprises in any industry of production and sale of services, on the one hand, creates unlimited opportunities for the development of a particular business, on the other hand, each type of activity has a certain threshold of efficiency, determined by break-even.

In turn, the amount of revenue that guarantees a profit is directly dependent on the total costs of production and sales of products.

What it is?

The total expenses of the enterprise for the purposes of analyzing the break-even activity are usually divided into two main categories:

• - costs, the amount of which directly depends on the volume of production and sale of the service (depending on the chosen direction of the company's functioning), that is, in fact, they are directly proportional to any fluctuations in the volume of the main activity carried out;
• fixed - these are costs, the amount of which does not change in the medium term (a year or more) and does not depend on the volume of the company's main activities, i.e., they will exist even if the activity is suspended or terminated.

Having considered fixed costs on the example of an enterprise, it is easier to understand their essence and interdependence with the volume of the main activity.

So, they include the following items of expenses:

• depreciation charges for the company's fixed assets;
• rent, tax payments to the budget, contributions to extra-budgetary funds;
• bank expenses for servicing current accounts, organization loans;
• remuneration fund for administrative and managerial personnel;
• other general business expenses necessary to ensure the normal functioning of the enterprise.

Thus, the essence of the fixed costs of any organization is reduced to their functional necessity for the implementation of activities. They can and most often change over time, but the reason for this is external factors (change in the tax burden, adjustment of the terms of service in the bank, renegotiation of contracts with service organizations, change of tariffs for public Utilities etc.).

Internal factors influencing the change in fixed costs are significant change corporate policy, personnel remuneration systems, a significant change in the volume or direction of the company's activities (not just a change in volumes, but a cardinal transition to a new level).

Under the influence of all these factors, there is a change in fixed costs, usually they are characterized by sharp fluctuations in the amount of costs.

For the purposes of accounting and analysis, the expenses of the enterprise are usually divided into constant and variable, using the following methods:

• Based on experience and knowledge, through management decision a certain category is assigned to expenses. This method is good when the company is just starting its activity and there are simply no other ways of attributing costs. It is characterized by a high level of subjectivity and requires revision in the long term.
• Based on the data of the conducted analytical work on the search, assessment and differentiation of all expenses by categories based on their behavior under the influence of the factor of changes in the volume of the main activity. It is the most acceptable, since this method is more objective.

For information on which of the costs in which group you need to determine, see the following video:

How to calculate them?

Fixed costs are calculated using the formula:

POSTZ = W salary + W rent + W banking services + Depreciation + Taxes + Public services, where:

• POSTZ - fixed costs;
• 3 salary - the cost of salaries of administrative and managerial personnel;
• Lease - lease expenses;
• Banking services - banking services;
• PROSHHOZR - other general operating expenses.

To find the indicator of the average fixed costs per unit of output, you must apply the following formula:

SrPOST = POST / Q, where:

• Q is the volume of products (their quantity).

The analysis of these indicators must be carried out in dynamics, evaluating the retrospective values ​​at different time intervals, including with a joint analysis of other economic indicators. This will allow you to see the relationship of processes specific to the enterprise, which means you can get a cost management tool in the future.

Economic meaning

The analysis of fixed costs, carried out both on an operational basis and for the purpose of strategic planning, allows you to assess the capabilities of an enterprise to improve the efficiency of its activities. This is the key economic meaning of this category.

The easiest and most affordable way to analyze the performance of a company is to assess the break-even point indicator, including in dynamics. To carry out calculations, data on the amount of fixed costs, the unit price and average variable costs are required:

TB = POSTZ / (C1 - SRPEREMZ), where:

• TB - break-even point;
• POSTZ - constant spending;
• C1 - price per unit. products;
• СрПРЕМЗ - average variable costs per unit of production.

The break-even point is an indicator that allows you to see the border beyond which the company's activities begin to make a profit, as well as to analyze the dynamics of the impact of changes in costs on the volume of production and profit of the organization. The decrease in the break-even point with constant variable costs is positively assessed, this signals an increase in the efficiency of the enterprise's expenses. The growth of the indicator should be assessed positively when it occurs against the background of an increase in sales, that is, it speaks of building up and expanding the scope of activities.

Thus, accounting, analysis and control of fixed costs, reducing their load on a unit of manufactured products are mandatory measures necessary for every enterprise to achieve competent resource and capital management.

Let's talk about the fixed costs of the enterprise: what is the economic meaning of this indicator, how to use and analyze it.

Fixed costs. Definition

Fixed costs(EnglishFixedcost,FC,TFC ortotalfixedcost) Is a class of enterprise costs that are not related (do not depend) on the volume of production and sales. At every moment of time, they are constant, regardless of the nature of the activity. Fixed costs, together with variables that are the opposite of fixed costs, make up the total costs of the enterprise.

Fixed Cost / Cost Formula

Possible fixed costs are shown in the table below. In order to better understand fixed costs, let's compare them with each other.

Fixed costs= Costs of salary + Rent of premises + Depreciation + Property taxes + Advertising;

Variable costs = Raw materials costs + Materials + Electricity + Fuel + Bonus part of the salary;

Total costs= Fixed costs + Variable costs.

It should be noted that fixed costs are not always constant, because an enterprise, while developing its capacities, can increase production areas, the number of personnel, etc. As a result, fixed costs will also change, so management accounting theorists call them ( notional fixed costs). Similarly, for variable costs - conditionally variable costs.

An example of calculating fixed costs in an enterprise inExcel

Let us show clearly the differences between constant and variable costs... To do this, in Excel, fill in the columns with "production", "fixed costs", "variable costs" and "total costs".

Below is a graph comparing these costs with each other. As we can see, with an increase in the volume of production, the constants do not change over time, but the variables grow.

Fixed costs do not change only in the short run. In the long term, any costs become variable, often due to the influence of external economic factors.

Two methods of calculating costs in the enterprise

When manufacturing products, all costs can be divided into two groups according to two methods:

• fixed and variable costs;
• indirect and direct costs.

It should be remembered that the costs of the enterprise are the same, only their analysis can take place according to various methods. In practice, fixed costs overlap strongly with concepts such as indirect costs or overheads. As a rule, the first method of cost analysis is used in management accounting, and the second in accounting.

Fixed costs and enterprise break-even point

Variable costs are part of the break-even point model. As we determined earlier, fixed costs do not depend on the volume of production / sales and with an increase in the volume of output, the enterprise will reach a state where the profit from the products sold will cover the variable and fixed costs. This state is called the break-even point or the critical point when the company goes into self-sufficiency. This point is calculated in order to predict and analyze the following indicators:

• at what critical volume of production and sales the enterprise will be competitive and profitable;
• what volume of sales must be done in order to create an area of ​​financial security of the enterprise;

The marginal profit (income) at the break-even point coincides with the fixed costs of the enterprise. Domestic economists more often use the term gross income instead of marginal profit. The more the profit margin covers fixed costs, the higher the profitability of the enterprise. You can study the break-even point in more detail in the article ““.

Fixed costs in the company's balance sheet

Since the concepts of fixed and variable costs of the enterprise refer to management accounting, then there are no lines in the balance sheet with such names. In accounting (and tax accounting), the concepts of indirect and direct costs are used.

In general, balance lines can be attributed to fixed costs:

• Cost of goods sold - 2120;
• Selling expenses - 2210;
• Management (general business) - 2220.

The figure below shows the balance sheet of OJSC “Surgutneftekhim”, as we can see, fixed costs change every year. The fixed cost model is a purely economic model, and it can be used in the short run, when revenues and production volumes change linearly and regularly.

Let's take another example - OJSC ALROSA and look at the dynamics of changes in conditionally fixed costs. The figure below shows the pattern of cost change from 2001 to 2010. You can see that the costs have not been constant over the past 10 years. The most sustainable costs throughout the period were selling expenses. The rest of the costs changed in one way or another.

Summary

Fixed costs are costs that do not change with the volume of production of the enterprise. This type of costs is used in management accounting to calculate total costs and determine the break-even level of an enterprise. Since the company operates in a constantly changing external environment, then fixed costs in the long run also change and therefore in practice they are often called conditionally fixed costs.