Posted by dapj20 on Oct 08, 2019 in Engineering-Management
This is a Crude Costing Formulae based on my Ideas which is called "Gut-Feel Thumb-Rule Methodology." Even Though i am probably the only follower of this popular System, I am sure it is worth a casual Look.
RM - Raw Material Cost SP - Selling Price to Distributor
Reserves are for Dry days, Employee Fund is to reduce Attrition and Layoff. I was costing the products as a Proprietor, Managing Director and as an R&D Engineer too.
This post is just to enlighten you of the intricacies involved. It is merely the Tip of the IceBerg. You will need a Spreadsheet and lot of foresight and hindsight to make a practical costing.