It is impossible for a single method of calculating production costs to work for all companies or businesses, much less for a Microsoft Excel template or method to cover them. This is because production costs are calculated differently by different types of business and industry, and for different purposes. Also, fixed and variable costs may be calculated differently at different phases in a business's life cycle or accounting year. Whether the calculation is for forecasting or reporting affects the appropriate methodology as well.
Production costs are usually part of the variable costs of business because the amount spent will vary in proportion to the amount produced. However, the costs of machinery and operational spaces are likely to be fixed proportions of this, and these may well appear under a fixed cost heading or be recorded as depreciation on a separate accounting sheet. The person creating the production cost calculation, therefore, has to decide whether these costs are already accounted for or if they must be a part of the overall calculation of production costs.
However, if the required definitions of production costs and the purpose for the accounting are known, several basic templates are available for Microsoft Excel that can help produce accurate accounting results. Business-Spreadsheets.com offers a variety, for example. Another site, Brighthub.com, offers reviews of financial software products for business owners.
Users can also create their own spreadsheets by accurately inputting all fixed costs and using standard formulas to calculate the impact of variable costs as production amounts change. These formulas should include the cost per item or unit with deductions for any work remaining in progress at the end of an accounting period.