ANALYSIS OF CALCULATION OF COST OF GOODS SOLD

IN MANDJA CUISINE

BY:
INDRA PUSPA NEGARA
(16023000089)

ACCOUNTING – SEMESTER VI
MANAGEMENT ACCOUNTING SEMINAR
FACULTY OF ECONOMICS AND BUSINESS
UNIVERSITY OF MERDEKA MALANG
 CHAPTER I
INTRODUCTION

A. Background
Food is one of the needs of every living thing. Eating enough and
nutritious food can provide strength to undergo various activities.
Elements contained in food consists of energy, building materials, and
regulating substances. Good food besides judging by the appearance
offered, any ingredients must be known used, how the manufacturing
process, and how exposures so that the food is suitable for consumption
because of food which is ideal for consumption not only has good taste.
The food service industry is one of the businesses that have a perfect
prospect if managed properly and correctly. Service industry food can
also be divided into two groups, namely Profit Oriented, namely which
prioritizes profit and Cost Provision, which has limits certain in its
activities and does not prioritize profits.
The emergence of businesses engaged in food classified into
Profit Oriented makes competing entrepreneurs more stringent to
attract as many consumers as possible. Calculation of cost of
production according to Catering Mandja cuisine is only inserting raw
material, packaging and gas components, whereas with the full costing
method taking into account all costs associated with its production
process. These costs are referred to as raw material costs, direct labor
costs, variable overhead costs, and fixed overhead costs. The
difference between the two calculations is where the calculation is
based. This catering gets a lower cost of production, compared with full
costing calculation. This affects the selling price set.
Accounting Study Program, Faculty of Economics and Business,
Merdeka University, Malang must have the ability to analyze a problem
that exists in their daily lives. Through this management accounting
seminar course, students are given the task of conducting research on
an entrepreneurial endeavor, especially I take catering owned by my
 aunt since 2007 who used to cook for staff and employees of the
economic and business faculties.
This catering is named Mandja Cuisine, where I focus on monthly
catering that is ordered by the economics faculty to the catering, which
is given a daily fund of Rp 160,000 to make 40 servings of food. So that
food can be calculated per portion of Rp 4,000 / person, but catering
for Mandja Cuisine when receiving these orders do not take into account
other costs that can affect the cost of production. In this case, I will
calculate all costs - costs that are not calculated by the Mandja Cuisine
catering and compare the prices given by this catering with the
calculation of Full Costing.

B. Problem Formulation
Mandja Cuisine Catering is one of the businesses engaged in the
Food Service Industry. Catering Cuisine was founded by Ms. Evi and
Widya in 2007. The products served at Mandja Cuisine Catering consist
of a full menu, staple food, animal dishes, vegetable dishes, and
vegetables, using a 5-day menu cycle. The number of employees doing
work is 2 people. Since the establishment of Mandja Cuisine Catering
from 2007 until now in calculating production costs, it still uses simple
calculations by calculating the prices of raw material needs, packaging,
transportation and gas requirements.
Depreciation of tools, labor, electricity, water, and other needs is
not taken into account because Sehati Catering in determining the
selling price directly determines the desired profit assumption of around
100% of the material requirements issued. This is because Mandja
Cuisine Catering is an old-age catering that does not take into account
the benefits to be achieved. As a result of determining production costs
in a simple way, several important components are not included in the
calculation which results in the determination of the selling price to be
too high or too low. With this condition, it is feared there will be a
deviation which means there is an error in determining the production
costs which will lead to errors in determining the selling price.
 Besides that, it also shows how the management of working
capital is related to the frequent changes of groups that handle this
business so that the formulation of the problem is as follows.
1. What is the calculation of the cost of producing made by Mandja
Cuisine Catering?
2. How is the calculation of production costs at Mandja Cuisine Catering
as a business unit and not a business unit with the Full Costing
method?
3. How is the difference between the calculation of production costs
applied by Mandja Cuisine Catering with the calculation of production
costs based on the Full Costing method and how does it affect the
selling price?

C. Purpose of the paper

The research on determining the cost of production aims to,
1. Analyze the calculation of the cost of goods manufactured by Mandja
Cuisine Catering.
2. Analyze the method of calculating the cost of rice box production at
Mandja Cuisine Catering as a business unit and not a business unit
with Full Costing method.
3. Analyzing the difference between the calculation of the cost of
production applied by Mandja Cuisine Catering with the calculation
of the cost of production based on the Full Costing method and how
it affects the selling price.
 CHAPTER II
DISCUSSION

A. History of Manja Cuisine Catering

The Mandja cuisine catering originally had the name Hallelujah
Catering which was established in 2007 and changed its name in 2017.
The catering was founded by 2 (two) people namely Mrs. Evi and her son
Widya who at the beginning stood only selling typical Javanese and
Manado wet cakes. Eventually, the catering started to receive orders at
the end of 2016.
This catering is located on Jalan Ranakah No. 16 Tidar, Malang City.
This catering often entrusts the pastries in the canteen - the faculty
canteen at Merdeka University Malang. Then in 2018, they began to
receive catering orders from the Faculty of Economics and Business to
cook as many as 40 servings each day with a given capital of Rp 160,000
per day. So every day catering this Monday - Friday is only done by 2
(two) employees.

B. Process Production
Catering Sehati does rice box production activities starting at 4:30
a.m. to 11:00 a.m. every day with a different menu, which uses a five-day
menu cycle. Although the menu is used different, for the stages in the
production process is not much different.

C. Production Cost
Production costs are costs associated with cooking, where
production costs consist of raw material costs, direct labor costs, factory
variable overhead costs, and factory fixed overhead costs.
1. Raw material cost
The cost of raw materials available at Mandja Cuisine Catering in
producing food consists of chicken and meat as animal side dishes,
tofu, tempeh, and potatoes as vegetable dishes, as well as carrots,
beans, spinach, bean sprouts, cabbage and corn as vegetables and
other ingredients.
 This can be seen from the menu offered from Monday to Friday and
can be seen in Appendix 1.
2. Direct labor cost
Mandja Cuisine Catering has two staff responsibilities. Mandja Cuisine
Catering produces if there are only orders, except Sundays and red
dates, so that their holiday time is at that time. The production activities
of these foods start at 04.00 - 11.00, and are immediately served in
the Faculty of Economics and Business until 13.30 WIB.
3. Factory Overhead
Factory overhead costs consist of variable overhead and costs fixed
overhead. Variable overhead costs at Sehati Catering consist of a
thermos box, plastic, spoon, rice paper, tissue, label and LPG gas fuel.
Mandja Cuisine Catering does not take into account the cost of
electricity and water, where all electricity and water use for the whole
house. Fixed overhead costs consist of buildings, and equipment used
such as gas stoves, blenders, cages, pans, pans, wooden spoons,
washbasins, stainless plates, stainless steel bowls, but are not taken
into account in determining the cost of food production.

D. Calculation of Cost of Goods Sales

1. Calculation of Cost of Goods Sales by Mandja Cuisine Catering
Mandja Cuisine catering in calculating the cost of production is still
done in a simple manner, which does not specify all the costs that have
an effect on producing food per serving. Costs that are taken into
account are only raw material, gas, and transportation costs.
Electricity, water, labor, and equipment depreciation costs are not
taken into account. Mandja Cuisine Catering in determining the selling
price directly determines the selling price of the budget given by the
faculty to them as much as Rp 160,000, so in determining the cost of
production by determining half the selling price such as, the food wants
to be sold at Rp 4000, - as many as 40 servings/day and the 5 portions
are taken for their food supplies at home.
 Mandja Cuisine Catering uses a five-day menu cycle where the
ingredients used are not much different from the other menus. So that
the raw material costs for catering groups one and two for Monday's
menu are Rp 3,017, Tuesday's menu is Rp 3,393, Wednesday's menu
is Rp 2,503, Thursday's menu is Rp 4,096, Friday's menu is Rp 3.110,
where the calculation of the cost of raw materials is obtained from the
average per serving of food from catering groups one and two. The
gas cylinder used is 3 Kg at a price of Rp 19,000, which can be used
for four days, so the cost per day is Rp 3,750 and for the suspension
fee Rp 93.75. Calculation of the cost of per portions of gas is obtained
from the cost of Rp The transportation fee of Rp 10,000 is used for
shopping and delivering food, so the per-portion cost for box rice is Rp
222 because the amount of transportation costs a day is divided by 45
servings.
Based on these details, the average cost of production for Mandja
Cuisine Catering menu on Monday was Rp 3,345, the cost of
production for Tuesday's menu was Rp 3,720, cost of production for
Wednesday's menu was Rp 2,831, cost of production for Thursday
menu Rp 4,397, the cost of production for the Friday menu is Rp
4,397. Calculation of cost of production based on Mandja Cuisine
Catering recordings can be seen in Table 1.

Table 1. Cost of Goods Sold based Mandja Cuisine Method

MENU DESCRIPTION COST PER COST PER COGS
COST PORTION DAY/45 PORSI (RUPIAH)
(RUPIAH) (RUPIAH)
MONDAY RAW MATERIAL
3.017 135.778
COST
GAS 106 4.750
TRANSPORTATION 222 10.000
TOTAL 3.345
TUESDAY RAW MATERIAL
3.393 152.670
COST
GAS 106 4.750
TRANSPORTATION 222 10.000
TOTAL 3.720
 WEDNESDAY RAW MATERIAL
2.503 112.650
COST
GAS 106 4.750
TRANSPORTATION 222 10.000
TOTAL 2.831
THURSDAY RAW MATERIAL
4.069 183.100
COST
GAS 106 4.750
TRANSPORTATION 222 10.000
TOTAL 4.397
FRIDAY RAW MATERIAL
3.110 139.950
COST
GAS 106 4.750
TRANSPORTATION 222 10.000
TOTAL 3.438
Source: Data processed, 2019

2. Calculation of Cost of Goods Sold by Full Costing Method

a. Raw material cost
The cost of raw materials for producing one portion of box rice by
Sehati Catering for every Monday - Friday can be seen in Appendix
1 and details of the cost of raw materials used to produce 45
portions of food can be seen in Table 2.
Table 2. Raw material cost
COST PER COST PER
DESCRIPTION
MENU PORTION DAY/45 PORSI
COST
(RUPIAH) (RUPIAH)
MONDAY 3.017 135.778
TUESDAY 3.393 152.670
RAW MATERIAL
WEDNESDAY 2.503 112.650
COST
THURSDAY 4.069 183.100
FRIDAY 3.110 139.950
Source: Data processed, 2019

b. Direct labor cost

Mandja Cuisine Catering Operations begin at 04.00 - 11.00 WIB
with 2 (two) people who carry out food made from Monday to Friday.
The employee gets a holiday on a red date and Sunday. Calculation
of rates/wages on catering as a business unit received by catering
owners is Rp 0 / day. While the calculation of rates/wages as a
 business unit is Rp 104,000 /day/person. Calculation of wages that
should be received for Mandja Cuisine Catering as a business unit
can be seen in Table 3.
Table 3. Direct Labour Cost
DIRECT LABOUR COST
INFORMATION 2 PERSON 1 PERSON
OPERATIONAL
04.00 - 11.00 04.00 - 11.00
HOUR
UMR 2.600.000 2.600.000
TOTAL LABOUR 2 1
TOTAL PER MONTH 5.200.000 2.600.000
TOTAL PER DAYS 208.000 104.000
Source: Data processed, 2019

c. Factory overhead variable

Table 4. Electricity Cost
ELECTRICITY COST

TOTAL POWER USED PER ELECTRICITY

GOODS
GOODS (kWh) DAY (JAM) IN MONTH (J)

LAMP 2 0,012 4 2,88

REFRIGERATO
46,08
R 1 0,064 24
FREEZER 1 0,1 24 72
BLENDER 1 0,3 0,25 2,25
TOTAL ELECTRICITY PER DAY Rp 123,21
TOTAL ELECTRICITY PER MONTH Rp 73.926
ELECTRICITY COST FOR 45 PORTION Rp 2.464
ELECTRICITY COST PER PORTION Rp 55
Source: Data processed, 2019

Table 5. Factory Overhead Variable Cost

COST FOR 45
VARIABLE FACTORY
UNIT (RUPIAH) PORTION
OVERHEAD
(RUPIAH)
LPG 106 4.750
TRANSPORTATION 222 10.000
WATER 67 3.000
TOTAL 394 17.750
Source: Data processed, 2019
 d. Factory overhead fix
Table 6. Factory Overhead Fix Cost
FACTORY OVERHEAD FIXED
FACTORY RESIDUAL
PRICE COST ECONOMIC DEPRECIATION
OVERHEAD TOTAL VALUE
(RUPIAH) (RUPIAH) VALUE COST (RUPIAH)
FIXED (RUPIAH)
STOVE 1 350.000 350.000 150.000 3 66.667
FREEZER 1 4.000.000 4.000.000 750.000 5 650.000
REFRIGERATOR 1 2.500.000 2.500.000 500.000 5 400.000
LPG 3 KG 5 19.000 95.000 - 4 23.750
BLENDER 2 300.000 600.000 - 3 200.000
BOILER 1 100.000 100.000 - 4 25.000
BIG PAN 2 50.000 100.000 - 4 25.000
SMALL PAN 3 50.000 150.000 - 3 50.000
THERMOS 2 200.000 400.000 - 2 200.000
TUPPERWARE 2 50.000 100.000 - 2 50.000
CUTTING
2 20.000 40.000 - 2 20.000
BOARD
SODET 3 10.000 30.000 - 2 15.000
KNIFE 2 15.000 30.000 - 2 15.000
PLATE 3 12.000 36.000 - 2 18.000
CUP 2 6.000 12.000 - 2 6.000
SPOON 5 1.500 7.500 - 2 3.750
Total 1.768.167
Source : Data processed, 2019

Tabel 7. Depreciation Equipment Expense per month

DEPRECIATION/YEAR DEPRECIATION/MONTH DEPRECIATION/45

INFORMATION
(RUPIAH) (RUPIAH) BOX (RUPIAH)
DEPRECIATION
1.768.167 147.347 109
EQUIPMENT
RENT 5.000.000 416.667 309
TOTAL 418
Data: Equipment depreciation expense per month

Based on the table above it can be seen that the annual

depreciation of equipment is Rp 1,768,167. Based on these
expenditures, Mandja Cuisine Catering must pay a monthly
depreciation fee of Rp 147,347, and per-day expenditure for 45
portions of Rp 418. The cost of renting a place for Mandja Cuisine
Catering is not calculated equal to electricity and water costs, but in
 determining the cost of production of components rent places must
be taken into account, whereby assuming the cost of renting a place
for Mandja Cuisine Catering is Rp 5,000,000 per year, with a size
of 8 x 4 meters so that the monthly fee is Rp 416,667, and the cost
per day is Rp 13,889 and if charged for the cost per portion of Rp
309. The total of Mandja Cuisine Catering's fixed overhead costs is
Rp 418.

e. Cost of Goods Sold per unit

Calculation of cost of production by calculating raw material costs,
direct labor costs, factory overhead costs, which consist of variable
overhead and fixed overhead. Based on the explanation explained
in the previous sub-chapter, the cost of production of catering as a
business unit and not a business unit with the full costing method
can be seen in Table 8 and 9. Details of the calculation of cost of
production of catering as non-business units can be seen in Table
8.
Table 8. The cost of producing at Catering as a business unit with
the full costing method
METHOD FULL COSTING
PRICE (RUPIAH)
COST
MONDAY TUESDAY WEDNESDAY THURSDAY FRIDAY
RAW MATERIAL
3.017 3.393 2.503 4.069 3.110
COST
DIRECT
0 0 0 0 0
LABOUR COST
FACTORY
OVERHEAD 394 394 394 394 394
VARIABLE
FACTORY
418 418 418 418 418
OVERHEAD FIX
TOTAL COGS /
3.830 4.205 3.316 4.881 3.992
PORTION
Source: Data processed, 2019

Based on Table 8, the calculation of the cost of rice box production at

Sehati Catering as a business unit with a full costing method is obtained
for Monday at a cost of RP 3,830, Tuesday RP 4,205, Wednesday RP
3,316, Thursday RP 3,316 and Friday RP 4,881. Calculation of cost of
 goods manufactured Catering as a business unit with the full costing
method which is RP 8,452 on Monday, Tuesday RP 8,827, Wednesday
RP 7,938, Thursday RP 9,503, and Friday 8,544, can be seen in Table
9.
Table 9. The cost of producing at Catering as a business unit with
the full costing method
METHOD FULL COSTING
PRICE (RUPIAH)
COST
MONDAY TUESDAY WEDNESDAY THURSDAY FRIDAY
RAW MATERIAL
3.017 3.393 2.503 4.069 3.110
COST
DIRECT
4.622 4.622 4.622 4.622 4.622
LABOUR COST
FACTORY
OVERHEAD 394 394 394 394 394
VARIABLE
FACTORY
418 418 418 418 418
OVERHEAD FIX
TOTAL COGS /
8.452 8.827 7.938 9.503 8.544
PORTION
Source: Data processed, 2019

After obtaining the calculation of the cost of goods manufactured

Catering based on business units and not business units with the
full costing method, it will be compared to see how much the
difference between the two comparisons.
Table 10. Comparison of COGS at Catering as a unit business and
non-business unit with a full costing method
Non-business Unit Business Unit Comparison
Days Menu
(Rupiah) (Rupiah) (Rupiah)
Monday 3.830 8.452
Tuesday 4.205 8.827
Wednesday 3.316 7.938 4.622
Thursday 4.881 9.503
Friday 3.992 8.544
Source: Data processed, 2019
 3. Comparison of Calculation of Cost of Production with the
Catering Method and Full Costing Method
Calculation of the cost of production that has been obtained based
on the Sehati Catering method and calculation with the full costing
method as a unit business and not a business unit, a comparison is
made to see how much difference between the two methods.
Comparison of the calculation of the cost of production can be seen in
Table 11.
Table 11. Comparison of calculation of COGS for Mandja Cuisine
catering with this catering method and Full Costing method
as a business unit and not a business unit

Catering Method Non-Business Unit Business Unit

Days Menu
(Rupiah) (Rupiah) (Rupiah)
Monday 3.017 3.345 8.452
Tuesday 3.393 3.720 8.827
Wednesday 2.503 2.831 7.938
Thursday 4.069 4.397 7.938
Friday 3.110 3.438 9.503
Source: Data processed, 2019

The difference that arises between the calculation with the Mandja
Cuisine Catering method with the full costing method for both business
units and not business units based on Table 11, that the calculation
with the Mandja Catering method Cuisine the cost of production
obtained is lower than the calculation with non-business units and
business units . The calculation with the Catering method is lower
because it only takes into account the cost of raw materials,
transportation, packaging, and fuel costs, whereas the full costing
method is not a business unit and the business unit has calculated all
costs included in the calculation of cost of production, such as raw
material costs, costs direct labor, variable overhead costs and fixed
overhead costs. However, there are differences between non-
business units and business units in terms of determining direct labor
costs, wherein the business unit direct labor costs are determined
 based on actual wages received if the catering is made into a business
unit business that aims to make a profit. The calculation of labor is not
a business unit, the determination of labor costs based on the daily
minimum wage received by most catering businesses.
Mandja Cuisine Catering stipulates that the selling price of these
foods is Rp 4,000. where the selling price is determined by Mandja
Cuisine Catering by determining the desired profit assumption of 10%
of the overall material price issued so that the selling price is obtained.
Based on the determination, it can be compared to the magnitude of
the profits obtained from Mandja Cuisine Catering by comparing based
on the full costing method for both business units and not business
units. Comparison of profits obtained based on the selling price with
the Mandja Cuisine Catering method and the full costing method as a
business unit and not a business unit can be seen in Table 12.
Table 12. Comparison of the benefits obtained based on the selling
price with the Sehati Catering method and full costing as a
business unit and not a business unit
Full costing Full costing
Catering Method
Non-Business Unit Business Unit
Price
Days Menu Raw Raw Raw
(Rupiah) Profit/Loss Profit/Loss Profit/Loss
material material material
(Rupiah) (Rupiah) (Rupiah)
(Rupiah) (Rupiah) (Rupiah)
Monday 3.017 983 3.345 655 8.452 (4.452)
Tuesday 3.393 607 3.720 280 8.827 (4.827)
Wednesday 4.000 2.503 1.497 2.831 1.169 7.938 (3.938)
Thursday 4.069 (69) 4.397 (397) 7.938 (3.938)
Friday 3.110 890 3.438 562 9.503 (5.503)
Source: Data processed, 2019

Based on Table 12, it can be seen that the profits obtained if the
material costs are reduced by the selling price, then it can be obtained
between Rp 3,017 to Rp 3,110 or with an average profit of 10% has
been achieved or can be said to exceed the target. Whereas profits
based on full costing calculations as not a business unit where the
selling price is reduced by the price of material gains from Rp. 3,345
to Rp. 3,438 or with an average profit of 10% and losses based on the
business unit are more than 100%. Judging from these results, if the
catering continues to sell at a price of Rp. 4,000 based on the business
unit, the catering actually loses. But they get the benefits of catering
from the advantages of the dishes they treat so that the benefits are
not visible but can be felt by the catering owner. The benefit 5 portions
every day when they made the foods, so 5 portions per day x 26 days
which is the profit per month Rp 4.000 x 5 x 26 is Rp 520.000.
 CHAPTER III
CONCLUSSION

Based on the results of the research and discussion in this study, it

can be concluded as follows:
1. The cost of production is determined by Catering Mandja Cuisine in
determining the selling price of rice boxes where Sehati Catering, only
includes components of raw materials, transportation, and gas.
2. The cost of production on box rice at Mandja Cuisine Catering as a
business unit and not a business unit with the full costing method shows
that the cost of production for the business unit ranges from Rp 8,452 -
Rp 9,503, while the cost of production as a non-business unit obtains
cost of production ranging from Rp 3,345 - Rp 3,438, both the
calculation of the cost of production for the business unit and not the
business unit with the full costing method where all costs related to the
production process are taken into account. These costs include raw
material costs, direct labor costs, variable overhead costs, and fixed
overhead costs.
3. The difference between the calculation of the cost of production based
on the method of catering with the full costing method, where the results
obtained for calculations based on Mandja Cuisine Cuisine earned the
cost of production which is too low, compared to the full costing
calculation. This affects the set selling price. Calculation of cost of
production with the catering method, is not appropriate if the food will
be sold at a price of Rp. 4,000 because the desire to get a profit of 10%
has been fulfilled, whereas the calculation is not a business unit of 10%
and full costing 100%.
4. The benefits of catering get not in the form of money but food they cook
directly with the order so that every day their profits are in the form of
cooking. But when calculated based on the form of cash for a month
amounting to Rp 520,000.