Garment Costing - How to Calculate Garment Cost

Garment Costing: How to Calculate Garment Cost 1.. Trim cost: $ 1.5 per garment excluding thread cost.. Labor rate: the selling price of a minute is $ 0.03 Answer: To calculate the cost

Garment Costing: How to Calculate Garment Cost

1 Fabric consumption: 0.8 yards per garment

2 Fabric wastage allowance 3%

3 Fabric price: $2.7per yard

4 Total charges for insurance & fright $ 0.3 (per yard) Fabric is being ordered from Hong Kong

5 Finance charges for fabric purchasing is 15%

6 Trim cost: $ 1.5 per garment (excluding thread cost)

7 5000 meter of thread cones being used for sewing, 210 meters of threads needed for a garment and the price of a thread cone is $6

8 Garment SMV is 40

9 Labor rate: the selling price of a minute is $ 0.03

Answer:

To calculate the cost of the garment, I will first create a table in excel sheet Then I will calculate material cost and labor cost Finally sum up all cost together to calculate total cost of the garment In the following I have shown you step by step process for calculating cost of the garment using information provided on the above

Step 1: Arrange information in the excel table, provided on the above problem See the following table, where I have arranged all required information to find final garment cost I have given code number to each information A, B, J

I added extra rows where I need to calculate something to calculate sub costs and necessary information Like M, N, O and P

Step 2: Calculate total fabric consumption including wastage percentage (M)

Total fabric consumption per garment = Calculated fabric consumption (1+Wastage%)

Or M=A(1+B)

Step 3: Calculate fabric cost per garment (N): Factory has incurred cost in insurance and freight and finance charge I have calculated fabric related cost together

So, Fabric cost per garment (including freight and finance charge) = (M*(C+D))+(M*C*E)

Step 4: Trim cost: Total cost of the trims has been given

Step 5: Calculate thread cost (O): From the thread rate (unit 5000 meters) and thread consumption, thread cost per garment is calculated

Here thread cost per garment = G*H/5000

Step 6: Calculate labor cost per garment (P): Labor cost per garment is calculated using garment SMV (standard time) and labor cost per minute

Labor cost per garment (P) = Garment SMV * Labor cost per minute

Step 7: Calculate total garment cost (GC):

I have calculated all sub costs required to find total garment cost

Total garment cost = (Fabric cost + Trim cost + Thread cost + Labor Cost)

Total garment cost = ($2.81 + $1.50 + $0.25 + $1.20) = $5.76