Total Production Cost

Work in progress. This note is still being written and incomplete.

1 min read Last updated Thu Aug 20 2026 06:37:25 GMT+0000 (Coordinated Universal Time)

Total production cost is the summation of prime cost and manufacturing overhead.

Prime Cost= Direct Material Cost+ Direct Labour Cost+ Direct Other Cost\begin{aligned} \text{Prime Cost} = \ &\text{Direct Material Cost} \\ + \ &\text{Direct Labour Cost} \\ + \ &\text{Direct Other Cost} \end{aligned} Total Production Cost=Prime Cost+Production Overhead Cost\text{Total Production Cost} = \text{Prime Cost} + \text{Production Overhead Cost}

Cost Structure

  • Manufacturing / production cost
    Direct material, direct labour, variable manufacturing overhead, fixed manufacturing overhead.
  • Non-manufacturing / non-production cost
    Variable non-manufacturing overhead, fixed non-manufacturing overhead. Any expense incurred after completion of manufacturing, or not incurred for production.
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