The document discusses key concepts related to costing and pricing, including: 1) Cost of production includes supplies, raw materials, and labor expenses incurred to produce a product or service. 2) Markup is the difference between the cost of an item and its selling price, which represents the profit per item. 3) Calculating percent markup can be done by dividing the peso markup by either the cost or selling price of an item.

1. MELC
S
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2.1 discuss principles of
costing
2.2 compute cost of
production
TLE_HECK7/8PM0e-
5
Calculate Cost of Production

2. Cost of Production
It is the total cost incurred by a business to
either produce a product or offer their
services.
a. supplies and raw materials that
are consumed during production
b. labor expenses.

3. Markup
is the difference between how much
an item costs you, and how much you
sell that item for--it's your profit per
item.
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4. Calculate percent markup based on
cost. This is done by dividing the peso
markup by the cost.
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5. Calculate your percent markup
based on selling price. This is
done by dividing the peso
markup by the selling price.

6. cost principle
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 is an accounting principle that
requires assets, liabilities, and
equity investments to be recorded
on financial records at their
original cost.
 known as the historical cost
principle and the historical cost
concept.

7. Advantages of Cost
Principle
 the users of financial statements could
know exactly the original value of Assets or
Liabilities in the financial statements as it
requires no adjustments.
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 Verifying the value of assets or liabilities
base on a cost basis is much easier than
market value
 It is easy to understand by management,
accountant and auditor

8. Disadvantage of Cost
Principle
It does not reflect the real value
of assets or liabilities in the
current market.
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 the users will get confusing
especially when the market value of
assets or liabilities are significantly
different from original costs.

9. Answer this!
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10. Learning Task No. 3: Given the beefsteak
recipe and its estimated cost, compute
for the break-even price and impose a
50% mark up to determine the selling
price of your product.
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11. Business opportunities are like
buses. There's always another
one coming.
Richard Branson
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