Issues of Price Formation for Products of the Forestry Sector

. The article considers a theoretical framework of an enterprise's cost classification, states several types of product calculations, defines possible variants of determining a prime cost of harvesting 1m 3 of timber in the environment of the Republic of Mari El, emphasizes some regional specific features of pricing for wood resources.


Introduction
Economic and legislative transformations in Russia make a direct impact on the context of forestry functioning and the pricing policy of forestry products.
In present-day conditions, lease of forest lands has become the main form of forest use. At the same time, the management and economic functions in the forestry are separated according to the legislation. The major part of the total forest area is leased out for timber harvesting. Lease holders face problems with formation of prime cost for harvesting 1 m 3 of timber. Many lease holders calculate their expenses on the base of an actual value and then distribute it on the final product with reference to profit. This method does not give any information on distribution of expenses with regard to timber species and assortment. This method may be used in case of small scale harvesting. If timber harvesting is significant, then this method will increase the probability of a harvester's operating at a loss. Therefore, an operating income mainly depends on the method of cost assignment to final products. It forms the rationale of the research.
The goal of this study is to justify a prime cost of harvesting 1 m 3 of timber. The object of the study is the market of wood resources and their reproduction process in the Republic of Mari El.
The subject of the study is the methodology and mechanism of generating payments for wood resources.

Materials and methods
The theoretical and methodological base of the study is comprised of works by foreign and Russian researchers on the issues of price formation for forestry products.

Results
Operating expenses, process costs and the prime cost of products are essential economic notions that influence the financial results and as a consequence the enterprise performance.
Operating expenses refer to a monetary value of an enterprise's expenses on production and sale of products (works, services). An enterprise's costs represent a combination of human, material, financial and other resources used for a reporting period. The costs may be related to: -manufacture, this type of costs is attributed to a prime cost of products; -investments, this type of costs is aimed at the purchase of items of fixed assets. In this context, the former are attributed to a prime cost of the products, and the latter to the enterprise's profit (except interests on credits). Table 1 shows the classification of an enterprise's costs. The method of cost management is significantly determined by an accepted cost classification. In relation to the economic elements the following may be classified: -material costs (raw and source materials, bought-in semi-finished products and complementary articles, fuel, energy, etc.); SHS Web of Conferences 110 , 01008 (2021) ICEMT 2021 https://doi.org/10.1051/shsconf/202111001008 -labor costs (salaries and wages accrued for employees in kind and in the monetary form, bonuses, additional payments and fringe benefits and other payments attributed to compensation of employees); -insurance contributions (deductibles from employee compensation to a social security scheme, pension plan, and a statutory health insurance fund); -depreciation of fixed assets; -other costs (taxes and charges attributed to a prime cost of products, payment of credit interests, business travel expenses, business expenses, etc.) When distributed in relation to the economic elements, the monetary costs of an enterprise are not distributed to individual types of products and other economic needs. Therefore, when this method of cost management is used, it is impossible to determine a prime cost of an product item. In practice, harvesters using this method of cost distribution for forming a price for 1 m 3 of timber orientate at an industry average value of their region or district. This method incurs a great probability of loss.
Calculations using account costs help to determine costs per product item. Table 2 shows the calculation of a prime cost in the general form.

Account cost Calculation method
Raw and source materials using norms for consumption and prices per product item Shipping and handling expenses % to material prices Recyclable wastes using norms and prices for possible use (to be deducted) Bought-in complementary articles, semiproducts, and production services using norms for consumption and prices per product item Fuel and energy for process purposes using norms for consumption and prices per product item Basic salary of direct labor piece wage-rates Additional salary of direct labor % to a basic salary Deductibles for social schemes % to a basic and additional salary Equipment maintenance expenses using an estimate and standard consumption Pre-production and start-up expenses using an estimate and standard consumption Shop costs using an estimate and standard consumption SHOP PRICE a sum of all the account costs mentioned above General business expenses using an estimate and standard consumption MANUFACTURING COST a shop price plus general production expenses Selling and marketing expenses proportionate to a manufacturing cost TOTAL COST a manufacturing cost plus selling and marketing expenses Thus, the prime cost of a product item is a summarizing indicator of intensification and effectiveness of resource use and consumption and accumulates expenses on production and sale of a product item according to the set calculation elements. Figure 1 represents several types of calculation. -Methodology for determination of contractual prices for forestry products (works, services) (developed by the All-Russian Institute of Continuous Education in Forestry, Pushkino, 2004) [4].
The flow chart of the manufacturing process is as follows: tree felling, limbing. An instrument used is a Husqvarna-365 motor saw. The composition and classification of the staff include a Grade 6 tree feller, a Grade 4 forest laborer, a Grade 4 branch cutter. An average stem volume is 0.35 m 3 . The work scope is presented in Table 3. The calculations are based on The industry-specific composition of expenses included into the prime cost of products at enterprises of the forest industry complex. In Table 4 we can give four variants of the prime cost calculations depending on the method of determination of expenses on equipment maintenance and distribution of an leasing fee.

Conclusion
The calculation results are shown in Table 5. As can be seen from the above, prime cost formation by different methods may lead to different results.
To assess wood resources at the regional level we have to take into account the following specific features [5]: 1. The wood resources are spatially located in the territory of a region, so this makes their characteristics be regional. This type of natural resources is a large-scale in terms of space and time regional capital which can give a constant income if the right methods of forest use and regeneration are used. At the regional level, availability of such large-scale in terms of the territory and time sources of material wealth as the forest stands of a region generally differs in values from a region to a region.
2. Due to its natural and climatic environment, each region is characterized by its own quality range of the wood resources available in the territory of this region. The natural productivity of different species is in direct relationship to the favorable for a certain tree species conditions of the climate, relief, and soil which have their regional characteristics.
3. Quality and allocation of the wood resources within a region make an impact on management decisions concerning the use of wood resources of a region. 4. A regional business sector engaged in harvesting and processing the timber reserves orientates at the regional market prices for forest products and on the availability in the region of manufacturing facilities for processing raw materials into final products, convenient transport routes, closeness and capacity of markets for selling both raw materials and final forest products.
All the above mentioned specific features of the wood resources should be taken into account during the assessment process as they influence the prime cost and price of the wood resources.