Issues regarding the cost accounting of intermediate by-products in chemical plants
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We are a fertilizer factory, and we now need to calculate the cost of the intermediate product, liquid ammonia, including both operating costs and fixed costs. How would you go about carrying out this calculation? Please give an example to explain.
Operating costs are calculated by adding up the costs of main materials, auxiliary materials, electricity, steam, water, maintenance, depreciation, labor, protective equipment, testing, quality inspection, packaging materials, and management
I’m roughly aware of the projects, but as for how to allocate the costs across the entire plant, take ammonia synthesis and urea as an example: if urea is not needed, the cost of ammonia synthesis will definitely increase. How should this cost be recalculated?
Then calculate the total cost of synthetic ammonia, allocating it according to the respective proportions occupied by ammonium carbonate, **, urea, and so on
Currently, each has its own allocation of amortization costs. But if the production facilities for later stages are shut down, should these amortization costs be included in the fixed costs of the intermediate products? For example, the labor costs associated with those later stages (as it’s not possible to lay off employees), the depreciation of the equipment used in those stages (since it still needs to be depreciated), and so on.
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