COSTING IN RAILWAY WORKSHOPS

RAMANAND BHAGAT

IRAS (P)

The salient information generated is:

Average unit cost of POH, IOH, SR for each class of locomotive.Cost of repairs to individual locomotive, with details of repair activities carried out viz. normal overhauling (Group 'A'), unscheduled repairs (Group 'B') and high value items utilised on each locomotive ( Group 'C').Average unit cost of overhauling for each identified major assembly. Average unit cost of all major unscheduled repair activities.

CONTD;

Average unit cost of each of the major modifications undertaken.

Cost of high value items used on individual locomotives, cost centre wise.

Cost of high value items used on individual locomotives, cost centre wise.

PROCESS

Work Order It is the authority under which Work is undertaken in

the workshop.The workorder has 8 digits, the last 3 digits denote the cost centre number applicable to the individual repair activity.

0 (indicates Rly No.)0 0 (indicates shop No.)0 (indicates Demand No)0 (indicates Minor Head of the demand)0 0 0 (indicate cost centre No).

Cost Centre

Cost centre is a section or a group thereof where a specific repair activity is undertaken. Each cost centre is identified by a cost centre number. Each Cost Centre will have a fixed work order number.

Elements of cost of repair activity

Basic cost element (Group-A Cost Centres.)

Variable cost element ( Group B Cost Centres)

Cost of high value items (Group C Cost Centres)

Time BookTime Book is filled up daily by the supervisor of individual section/cost centre indicating the number of hours, which each worker has been utilised during the day, on different work orders.

Time SheetTime sheet is prepared by the Time Office from Time Book and is reconciled with gate attendance card (GA Card). It indicates the ticket number and hours worked daily, total hours for the month, Hourly Rate of the worker and the amount.

Outturn

Outturn represents the quantum of work/repair activity done during a month .

Shop Outturn

Section outturn

Equated Outturn

Labour Sub-LedgerLabour Sub-ledger consolidates the labour charges against

each work order, which in the revised costing system incorporates the respective cost centre number.Stores Sub Ledger

Stores sub ledger consolidates total charges on account of stores (stock and non-stock) against each cost centre, work-order wise. In such cases where debit for non-stock item is not received in time, the cost is to be charged off on last rates available and final adjustment made later in the month in which debit is received.

Workshop General Register (WGR) Workshop General Register is the basic document in which

total expenditure of labour, stores and on-cost expenditure are consolidated cost centre/work order wise. The revised costing system makes no change in the format of existing WGR.Outturn statement

The outturn statement showing total debits for the.month under labour, stores and on-cost charges should be prepared in respect of each work order/cost centre by the accounts office. These are prepared in two :

Part I : Shows the outlay on completed and turned out locomotives/items of work which is adjustable to final heads of account during the month. "

Part II: Shows the outlay on locomotives/works in progress and completed works awaiting adjustment

Average Hourly Rate

Average unit Cost

Average unit cost of a cost centre is arrived at by dividing the total expenditure of the cost centre by its equated output.

JOB COSTING IN RAILWAY WORKSHOPS FOR WORKSHOP MANUFACTURED ITEMS

Objective:To compare the costs of similar articles manufactured

from time to time in the workshops and finding out reasons for variation in the Workshops with those manufactured in other railways or with the market price of similar articles.Essential Feature:

It is the estimating in advance of the time that should be spent and the materials that should be used and the systematic comparison of the results of actual performance with such estimates.

Process Involved:

Progress Sheet

Route Card

Job Card

Material requisition

Material tag

COLLECTION OF EXPENSES AND FIXATION OF THE UNIT COST OF MANUFACTURE OF

WORKSHOP MANUFACTURED ITEMS.

Cost Sheet

Collection of cost in the Workshop General Register.

Works Managers Cost Card.