Posts Tagged ‘costing’

Cost Estimate Types

There are different types of cost estimates including “Rough Approximation” of cost which can be a conceptual design, preliminary design and then a detailed estimate or quote. Rough Approximation The rough approximation is really prepared for informational purposes only.   This type of estimate may not have geometry or even materials but just a rough idea…

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Cost Estimating Versus Cost Accounting

What is the difference between cost estimating and cost accounting? Cost estimating is a precursor to cost accounting because it done at the beginning of the process.   Lets define cost estimating as the estimation of the cost of a goods or services  prior to the actual production of the goods or services.  Cost estimating…

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Estimating is more than Setup and Run Time Part 2

In the not to distant past many manufacturing processes were very labor intensive.  In countries such as China and India there is still a great deal of manual labor intensive manufacturing.  I remember as a child I worked in my Father’s sheet metal shop and the machine of choice was a Strippit 30/30.  I have…

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Estimating Software Guide

There are many different type of software estimating package for made to order manufacturing Made to order manufacturing includes any custom job shop type work including sheet metal, machining, wood working, stamping, press work, printing which all require customized quotes.   Quotes include both operation and bill of material.  Below you will find a checklist…

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Exploded Bill Of Materials

Estimating large projects requires an exploded bill of materials in order to get a good understanding of the requirements.   The larger the project you have to estimate the more in depth the bill of materials will be.   If you are estimating you want to make sure all the bills of materials are entered…

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What Are Bill Of Materials?

A good definition of Bill of materials comes from wikipedia Bill of materials (BOM) is a list of the raw materials, sub-assemblies, intermediate assemblies, sub-components, components, parts and the quantities of each needed to manufacture an end item or final product. All products have bill of material from engineering bill of materials, manufacturing bill of…

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Cost Estimating Purchased Parts Or Materials

Bill of material items are those items which are purchased as raw materials and used to combine with other products and services to produce a new product.   Job costing bill of materials is a critical step in the estimating and quoting process.  Classic ERP and MRP software provides tools to help estimating the bill…

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Job Shop Hours Defined

In job shop estimating where does efficiency play a role?  When you are estimating generally ask yourself how many “Man Hours” are required to producing the part or performing a specific operation. Lets define some terms first Man Hours Man hours is the total time to accomplish a given task.   This does not mean…

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Fabrication Workcenter Overhead Rates

When you quote a job and its operations you need to make sure you quote it accurately. Its very important to know that when you quote a job that your rates are high enough to actually turn a profit. [polldaddy poll=2007715] Welcome to the MIE Solutions Job Shop Estimating blog. Fabrication software as in sheet…

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Machine Shop Rates Part 2

Welcome to the MIE Solutions Job Shop Estimating  blog.   Fabrication software as in sheet metal software and manufacturing software deals with shop rates extensively for costing. There are basically 3 ways to calculate overhead absorption rates which is used to provide your shop sell rate during quoting and estimating. Company Overhead Absorption Rate Percentage…

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