The Enterprise theory - Purchasing and inventory management . PURCHASE •one of the basic corporate functions •it is implemented by all types of businesses •organizationally secured by the purchasing department Stages of the buying process ·purchase initiation ·specification of requirements (necessity, nature, scope) ·market analysis of possible suppliers ·selection of a suitable supplier ·wording of the order ·implementation of logistics activities associated with the entry of the delivery into the company ·delivery payment ·supplier performance evaluation STOCKS •current assets of the business •the result of a purchase or business activity •they always bind themselves with funds •To have or not to have? Can you do business without inventory? Types of supplies I. CLASSIFICATION OF STOCKS BY SPECIES ·production stocks: oraw materials, basic material, operating substances, spare parts, packaging otangible assets whose consumption period is less than 1 year ·work in progress inventory ·stocks of finished goods ·goods II. BREAKDOWN OF STOCKS ACCORDING TO FUNCTIONAL COMPONENTS ·current stock – to ensure expected consumption in the period between two deliveries ·insurance stock – to cover possible deviations in supplies or consumption ·technological stock – if the material needs to be modified before it is released for consumption, its amount results from the production technology ·seasonal ( occasional ) supply – compensates for expected fluctuations in supply or consumption ·speculative stock - to achieve an extraordinary profit by a suitable purchase ·emergency stock - ensures the survival of the business in the event of unforeseen events · III. BREAKDOWN OF STOCKS ACCORDING TO CAPACITY CALCULATIONS •minimum stock – stock status at the moment before a new delivery •maximum stock – the highest stock level reached at the time of a new delivery •immediate stock : oactual physical inventory - the actual stock level in the warehouse odisposition stock – actual stock reduced by already applied requirements for delivery (goods ready for dispatch) obalance stock – disposition stock increased by the size of stock deliveries ordered but not yet received (material on the way) The hotel is planning shopping activities for the next month of November. On average, 600 liters of juice are consumed in the hotel per day. Juices are stored in 0.5 l bottles. At the end of November, the hotel plans to have a stock of 2,500 bottles. At the beginning of November, this stock will be 2,600 bottles. How many bottles of juice must the hotel order for November? Resources = Needs No. inventory + purchase (delivery) = consumption + ending inventory 2600 + x = 36000 + 2500 Purchase = 35,900 pcs THE ENTERPRISE THEORY - CALCULATION . Tomáš Pražák Lecturer CALCULATION •calculation of costs, margin, profit, price or other value quantity for a product, work or service or for an activity or operation (calculation unit) •displays in relation to each other both in kind and value-expressed performance unit •the most important tool of economic management Purpose of costing •assign costs to the cost bearer (product, service, order), i.e. to the calculation unit •direct costs: odirect allocation per unit of output or per cost center •indirect costs: obefore scheduling on the performance unit of their allocation to end centers othey cannot be directly assigned to the performance unit - use of the costing schedule base Simple division calculation •in the case of linear dependence of costs in single-type production of products or services (energy production, lemonade, mineral extraction) •the cost per unit n j can be found directly by dividing the cost N by the output Q Example: The selected company deals with the packaging of Grilling Mixture per 25g of the delivered spice mixture. Material costs were CZK 14,000 for 54 kg of seasoning mixture. The company incurred wage costs in the amount of CZK 10,000 and other overhead costs (depreciation of the packaging line, share of administrative staff costs) in the amount of CZK 15,000. What will be the cost of producing one 25g bag of the mixture? Solution: We add up all incurred costs (material, wages and other costs) and divide them by the required calculation unit of 25 g /bag. TC = 14,000 + 10,000 + 15,000 = 39,000 CZK Number of units per 25 g = 54,000 g / 25 g = 2,160 bags Cost per unit = 39,000 /2,160 = CZK 18.05/pc Typical calculation formula 1. Direct material (raw materials, material, semi-finished products, purchased products) 2. Direct wages (wages of operating workers, bonuses, bonuses, allowances, additional payments) 3. Other direct costs (technological fuels and energy, depreciation, transport costs, repairs, technical development costs, etc.) 4. Production overhead (technological and general) (costs related to the management of production activities, process maintenance) Σ (1st-4th) Own production costs 5. Administrative overhead (may include supply overhead) (related to the management and administration of the organization) Σ (1st-5th) Own performance costs 6. Sales costs (may be part of administrative overhead) (shipping, advertising, promotion, sales) Σ (1.-6.) Full cost of performance 7. Business result - profit/loss + margin Σ (1.-7.) Price (production) Calculation formula line Type of cargo Calculation of the load per unit Cost per unit (CZK/piece) 1 material 2 employee salary 3 other direct costs 4 manufacturing overhead Σ 5 administrative overhead Σ 7 Margin - profit margin Σ costs The following production items for a medium-sized candle are given: •the production plan is 10,000 units, • •material consumption is 0.05 kg of beeswax at 1000 CZK/kg per 1 piece, •time consumption is 18 min/piece, • •hourly wage rate = 150 CZK/hour, • •manufavturing overhead budget = CZK 45,000 for the entire production plan, • •administrative overhead budget = CZK 60,000 for the entire production plan, • •other direct costs 31.5% of social and health insurance, •the margin is 30% of the full own cost of performance. • Create a preliminary calculation: Calculation formula line Type of cargo Calculation of the load per unit Cost per unit (CZK/piece) 1 material 0.05*800 50 2 employee salary 150/60*18 45 3 other direct costs 0.315*45 14,175 4 manufacturing overhead 45,000/10,000 4.50 Σ 113,675 5 administrative overhead 60,000/10,000 6 Σ 119,675 7 Margin - profit margin 119.675*0.3 35.9025 Σ price 155.58