What are the processes of production? - ProProfs Discuss

# What are the processes of production?

Asked by Archana, Last updated: Jul 13, 2024

#### Mike John

Self Motivator, Energetic & Smart Team Lead

Mike John, Content Explorer, MCA, Los Angeles, California, USA

Whenever a company is selling a product, there are different costs associated with that one product. The owner must determine how much that product costs them to make or procure. However, there are other costs associated with that product.

These include the store housing that product and the employees who require pay to try to sell that product. There are many other factors too. Therefore, in the math problem, a firm is producing seven units of output and has an average total cost of 150.

They have to pay 350 to its fixed factors of production whether it produces, sells or not. The average total cost which is made up of the variable costs would come to a total cost of 100.

#### John Smith

John Smith

0.88-the earned value (ev) and actual cost (ac) must be calculated tirst. to perform this calculation, multiply the percent complete of each task by its planned value (pv). thereby providing the ev for each task. sum the actual cost of each task to determine the total actual cost. sum the earned value of each task to detem1ine the total earned value. then divide the earned value of \$1277.5 by the actual cost of \$1452. this result provides a cpi of 0.88, indicating that the project is getting \$0.88 for every dollar it is spending.