Posts Tagged ‘bill of material’

Estimating For Paint Lines (Part 2 of 2)

As technology has improved over the years, paint lines have become more commonplace throughout job shops. The ability to estimate how much a part costs is now more complicated due to the batch process and automation of paint lines. This entry will show you a sample formula for estimating “time per part”. Variables FeetPerMinute VerticalParts…

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Classification Of Costs – Fixed and Variable Costs

There are many facets of costing and breaking costing into these four categories helps in understanding Fixed and Variable Costs Direct and Indirect Costs Costs are generally classified as to whether or not they vary with the quantity of parts being manufactured.  Many times this can be described as a Setup Cost because it does…

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Engineering Costs

Engineering costs for many years have basically been included in the standard burden rate of the shop.  There are many situations now in this world where manufacturing is very competitive and technical that the standard burden rate of the shop cannot include all the costs associated with the engineering costs. Direct Engineering Costs Direct engineering…

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Engineer To Order Material Costs

Now that we have been investigating many of the details of material costs in quotations, we will now take a look at the mathematical calculations required. Engineer To Order Material Costs Step 1)  Determine the quantity of parts required.   This is the number of parts required to make the end product.  In many situations…

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Material In Cost Estimates Weight Calculation

Material costs in job estimates can come in a variety of ways.   When you are estimating the cost to manufacture a product and the product is made out of either plate material, sheets, tubing, etc there are a few calculation methods that may be required. Here is a list of 7 calculation methods which…

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Material Estimating

Material estimating can be simple to complex depending on the particular job you are estimating.   Raw material is a commodity which could include metal sheets, wood, bars, plastic, plates, block of metal, etc.  These items are purchased from a supplier and are usually priced at a per unit weight price. A few examples 1.…

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Material Cost Calculation

Material cost calculation potentially involves a lot of information.  In my previous blog I mentioned many of the data points involved in the material cost calculation including Parts Size, Blank Size, Stock Size, Safety Stock Size, and others.  One of the reasons you need the part size is raw material is usually a commodity.  The commodity is usually priced in…

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Direct Labor Costs

Direct labor costs are those costs which are performed during the production of some product.  The product can be any type of item from a machined part, computer and vehicle.  Labor is required to change a raw material into a product that may be sold or given away.  Direct labor is calculated by taking the…

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Material Cost

Material cost is a big subject and will be handled in multiple blog entries.  Material costs are costs that go directly into producing the desired product.  Material costs can be divided into both direct and indirect material costs.  We will focus on direct costs because they directly affect the product’s price. Material can also be…

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Manufacturing Costs

Manufacturing costs consist of multiple elements which arrive at the full cost.  When estimating a product to be manufactured the entire costs are distributed between the following elements. Material Costs – This includes both raw materials, which is reshaped, formed, etc to produce the item and purchased prefabricated items, like nuts, bolts, screws.  The raw…

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