Logistics Costing in Manufacturing Companies

The methods of operative cost calculation and controlling are often used to improve production costing in the manufacturing industry. The basic idea of such approaches is that direct costs (e.g. used materials) are allocated to profit objects (products) directly while indirect costs are collected in so called cost objects (e.g. business units, manufacturing sites, service centers) first. The allocation of cost elements collected in cost objects is then carried out by using the performance flows. These performance flows can be identified between cost objects or between cost and profit objects. By doing so all cost elements are allocated to the products on a causeeffect basis ignoring the use of arbitrary calculation regimes (e.g. simple averaging).