Planning for production Flashcards
(21 cards)
What are direct costs in manufacturing?
Costs that can be directly linked to the production of a specific product, such as labour and materials.
Give two examples of direct costs.
Labour costs and material costs.
How do you calculate total direct costs?
Add together the labour costs and material costs.
What are overhead costs?
Indirect costs of running a business that aren’t directly linked to making one specific product, such as rent, electricity, or administration.
How do you calculate overhead costs if given as a percentage of labour costs?
Multiply the labour cost by the overhead percentage.
Example: If labour costs £100 and overheads are 20%, what is the overhead cost?
£20
How do you calculate total manufacturing costs?
Add the direct costs (labour and materials) to the overhead costs.
Example: If labour costs £150, materials cost £50, and overheads are £30, what is the total manufacturing cost?
£230
What is a fraction?
A way to represent part of a whole, written with a numerator and denominator.
How do you convert a fraction to a decimal?
Divide the numerator by the denominator.
How do you convert a decimal to a percentage?
Multiply the decimal by 100.
Example: What is 0.75 as a percentage?
0.75
What should you check when interpreting a data table?
Headings, units, and data labels to understand the values being shown.
What is a bar chart useful for?
Comparing quantities across different categories.
What is a line graph used for?
Showing trends or changes in data over time.
How do you find the total of values in a data table?
Add all the relevant figures together.
Why is it important to understand fractions, decimals and percentages in production planning?
To accurately calculate costs, profit margins, and production targets.
What is the benefit of using charts and graphs in production planning?
They help visualise data quickly, identify trends, and support decision-making.
What is meant by ‘labour costs’?
The total cost of the workers’ time spent making a product.
What is meant by ‘material costs’?
The total cost of raw materials needed to make a product.
Why are overhead costs important in production planning?
They contribute to the total manufacturing cost and affect the product’s selling price and profitability.
