Calculating Garment Production Cost from SMV

Calculating Garment Production Cost from SMV and Monthly Salary Data in the Garments Manufacturing Industry.

To Calculate the Garment Production Cost in Taka (Bangladeshi Currency) using SMV (Standard Minute Value) and monthly salary data, you can follow these steps:

Step-by-Step Calculation:

1. Calculate Labor Cost per Minute (LCM):

• Determine the labor cost per minute in Taka. This is done by dividing the monthly salary of the worker by the total number of minutes worked in a month.

  $$\text{<span style="font-size: medium;">Labor Cost per Minute (</span>LCM<span style="font-size: medium;">)</span>}=\frac{\text{Monthly Salary (in Taka)}}{\text{Total Minutes Worked }}$$in a Month

1. Determine SMV (Standard Minute Value):

   • SMV is the standard time in minutes required to complete a specific operation or task in garment manufacturing. It includes direct labor, machine time, and allowances.

2. Calculate Labor Cost per Garment:

   • Once you have the LCM and the SMV, multiply them to find the labor cost per garment in Taka. Labor Cost per Garment (in Taka)=LCM×SMV

     $$\text{Labor Cost per Garment (in Taka)}=\text{LCM}\times \text{SMV}$$

3. Consider Additional Costs:

   • Factor in other costs such as material costs per garment, overhead (rent, utilities), and variable costs (transportation, packaging).

4. Total Production Cost:

   • Sum up all the costs (labor, materials, overhead, and variable costs) to determine the total production cost per garment in Taka.

Example Calculation:

Let's assume:

• Monthly Salary of a worker = 20,000 Taka
• Total Minutes Worked in a Month = 40 hours/week × 4 weeks × 60 minutes/hour = 9600 minutes
• SMV for a particular garment = 6 minutes

1. Calculate Labor Cost per Minute (LCM):

   $$Taka per minute}$$

1. Calculate Labor Cost per Garment:

   $$\text{Labor Cost per Garment}=2.08\times 6=12.48\text{ Taka}$$

Therefore, the direct labor cost per garment, based on the given SMV and monthly salary data, is approximately 12.48 Taka.

Calculating Garment Production Cost from SMV and Monthly Salary Data in the Garments Manufacturing Industry. For a comprehensive production cost, ensure to include all relevant costs as outlined earlier. This calculation gives you a starting point based on direct labor costs in Taka.