How to compute the cost of products transferred from production to finished goods?

To compute the cost of materials into finished goods, you should add your assets needed to create your finished good.

For instance, to make a box full of kittens, I need to gather my material, Box, and Kittens. I find a farm selling or giving free kittens, cost = free. Then I get a box from the recycling center, cost = free. Then I label my box and tape it up. The roll of tape is good for about 25 boxes and costs 8$. 25/8 = $3.13 per box and the labels cost, we'll say 2 cents per box. And we'll say one marker to write on the label costs 5 cents per box. So you pay $3.20 per box and sell each box for $5. Your cost of production is $3.20.