What is Cost Accounting?

If you’re a business operator, you’re likely wondering, “what is cost accounting?”

Cost accounting is simply creating a system that allows you to fully understand the costs related to your product or service. This also involves understanding how much money it takes in order for you to fulfill customer requests.

Thus, with cost accounting, you can accurately determine the cost of the product you’re selling, which is essential if you want to make a profit.

This post covers the types of cost accounting, how it works, and some of the most frequently asked questions about it.

Types of Cost Accounting

Types of Cost Accounting

Standard Costing

Standard costing involves assigning “standard” costs instead of actual costs to its cost of goods sold (COGS) and inventory. These costs focus on the efficient utilization of materials and labor to produce your goods or services with standard operating conditions in mind. This is basically the budgeted allotment of labor and materials.

While standard costs get assigned to your goods, your operation still has to cover the actual costs.

Variance analysis involves analyzing how the standard cost and actual cost differ. Through this analysis, you’ll determine whether your actual expenses are beyond what you expected. If it is, then the variance is unfavorable. But if you see that the actual costs are less than expected, the variance is favorable.

The cost of input, like the cost of materials and labor, will influence variance favorability. But so does the efficiency or quantity of input utilized, as this is a volume variance.

Activity-Based Costing

Activity-based costing is a variation of standard costing. But rather than using a predetermined average cost to assign to your inventory, it assigns costs based on the actual activity you used to produce your items. This includes direct labor, materials, and overhead costs.

This type of costing is based on how you allocate your expenses instead of based on predetermined costs that may or not be accurate.

Activity-based costing is effective for companies that experience fluctuating production rates due to seasonal changes in demand and because the business has different product life cycles. Since these activities are observable as cost drivers, they’re used to measure how to allocate overhead costs.

Most of the time, overhead costs get assigned based on a since generic measure, like machine hours. Thus, activity-based costing is usually more accurate and helpful for analyzing the cost and profitability of a company’s services and products.

Lean Accounting

Lean accounting focuses on improving financial management practices for companies. This utilizes the philosophy of lean production and manufacturing, which highlights waste minimization and productivity optimization.

For instance, if your operation can lessen the wasted time, your staff can use that saved time on tasks to add value.

Lean accounting replaces traditional costing methods with value-based pricing and lean-focused performance measurements. Any time a financial decision is made, it focuses on how each will impact the operation’s total value stream profitability. These value streams generate profit for the operation, ultimately adding to bottom-line profitability.

Marginal Costing

Marginal costing, also known as cost-volume-profit analysis, focuses on the incremental costs and profit from a particular action. It’s important for businesses to understand this because it’ll determine if a company can sell a product or service at the desired profit margin.

The basic premise is that costs increase as you produce more units of a product. At the same time, the additional units sold increases the profit that a company can generate.

For instance, if you know what each product costs to produce and sell, you’ll be able to make solid decisions about which product you should sell more of, as well as what products to drop from your inventory. You can also identify how costs and volume impact operating profit.

Management can use this type of analysis to identify potentially profitable new products, as well as sale prices for existing products and the efficacy of marketing campaigns.

Types of Costs

Cost accounting involves several types of costs. Keep these in mind as you’re determining the costs involved in running your operation:

Fixed Costs

Your fixed costs stay the same, no matter what. Most of the time, these include utilities and rent. But they can include mortgages or lease payments on buildings or a piece of equipment that depreciates at a fixed monthly rate. Keep in mind, if your production levels change for better or worse, your fixed costs should not change.

Variable Costs

Variable costs change based on how much you’re selling. For example, this category includes inventory and labor related to production. If you’re manufacturing, your variable costs include materials. This cost goes down based on the unit price of the item.

Semi-variable Costs

These costs fall somewhere in between fixed and variable costs and can vary depending on business conditions. Some examples of this include packaging, breakage costs, and postage.

Operating Costs

Your operating costs are related to your day-to-day operations. These include office supplies, fixed salaries, and contracts with vendors you use on a regular basis.

Direct Costs

Direct costs are related to the production of the product or service. This includes materials, direct labor, and overhead. For example, if you’re producing cannabis fertilizer, your direct costs include the cost of the materials and the hourly wages for people who work on these products.

Indirect Costs

Your indirect costs are not related to the production of your product. They include facilities, insurance, advertising, shipping and distribution costs, etc. For example, the cannabis fertilizer producer would put the marketing costs in this category because it’s not exact and cannot be connected to individual products.

How Does Cost Accounting Work?

In order to make a profit in business, you need to understand the costs associated with making your product. Then, multiply your total costs by your price per unit.

Once you know your costs and how much you stand to make from every sale, you will have an accurate understanding of whether or not each transaction will be profitable.

A great way to learn the basics of cost accounting is with an actual example. Let’s say you’re producing fertilizer for indoor cannabis growers.

You know your fixed costs are $10,200 per month. Your variable costs include purchasing the materials for each pound of fertilizer you create, which is $3.50 per pound, and your labor costs are $0.32 per hour for each person who works on this project.

Your operating costs are $1,000 per month. Your direct costs are the materials that go into each pound of fertilizer ($3.50), and your overhead costs are the facilities you use to manufacture each pound of fertilizer ($0.55).

You decide to make 1000 pounds of fertilizer per month. The price you charge for each pound is $30 per pound. Because your fixed costs are the same no matter how many pounds of fertilizer you make, your profit per pound is $22.70 ($30 – ($3.50 +$0.55)).

Reflecting on Cost Accounting

While cost accounting has its place in the world, it comes with some drawbacks. These accounting systems can be expensive to develop and implement. But it’s equally important to note that training is time-intensive and can take some trial and error to get right.

If you need assistance with developing and implementing a cost accounting system, feel free to contact us. Our experts are eager to help!

Can Mushrooms Be Good for Anxiety? Shroompreneur Opportunities

As a consumer, you might be wondering, “Can mushrooms be good for anxiety?” But as a potential shroompreneur, or current legal mushroom business operator, you’re probably curious about the opportunities to serve this space.

Keep reading to learn about mushrooms for anxiety, how they help patients, and how these operations can earn you a profit while serving a massively expanding industry.

Can Mushrooms Be Good for Anxiety

Psychedelics for Anxiety

Psychedelic mushrooms for anxiety might sound like an obscure and surreal treatment, but it’s actually one of the most rapidly growing areas in medicinal mushrooms. Countless clinical studies show that psilocybin, which is found naturally occurring in several species of psychedelic mushroom, can help patients overcome anxiety, especially those with depression.

One study found that psilocybin mushrooms were an effective treatment for anxiety, depression, and pain among cancer patients. And another study highlighted that psilocybin helped reduce anxiety in terminal cancer patients.

The science is out. It’s clear that mushrooms for anxiety and depression exist, and there are tons of opportunities to serve the industry as a shroompreneur.

But how can you cash in on these psychedelic remedies? We’ll get to that soon.

First, let’s make sure we understand what medicinal mushrooms are before moving onto the specifics of psilocybin mushrooms for anxiety.

What are Medicinal Mushrooms?

Mushrooms have been used to treat medical conditions since ancient times by civilizations like China and Greece. It’s only recently that interest in medicinal mushrooms has picked up as a possible treatment option, due to the growing body of research which shows that these fungi can play a valuable role in treating certain diseases, including mental disorders and illnesses.

Medicinal mushrooms contain strong polysaccharide compounds that provide health benefits, including immune system support, anti-tumor effects, and even antiviral properties. In other words, mushrooms could help your body fight off viruses, reduce tumor growth and strengthen the immune system.

But Can Mushrooms Be Good for Anxiety?

Yes. While you might be thinking that magic mushrooms result in hallucinations and other alterations in perception and therefore may increase anxiety, the opposite can occur.

Even though some people might experience anxiety and paranoia after taking psilocybin, the research highlights that psilocybin might offer long-lasting benefits for anxiety and depression reduction.

Psilocybin has similarities to serotonin, which is a chemical compound the body produces to regulate mood. Magic mushrooms impact the body’s serotoninergic system, which gives them the potential to restore serotonin balance in the body.

Shroompreneur Opportunities in the Space

The anxiety disorder and depression treatment market offer incredible opportunities to those that participate in them. And shroompreneurs have the potential to get involved, whether now with legal medicinal mushrooms or in the future with psilocybin.

The global anxiety order and depression treatment market size are expected to hit $19.81 billion by 2028. Its CAGR is 2.4% over the forecast period, showing signs of impressive expansion that mushroom supplement and therapeutic treatment operations can obtain their share of if marketed properly.

While still federally illegal, we’ve seen plenty of progress that points to inevitable federal legalization. As states and cities like Oregon and Detroit decriminalize psilocybin for medical conditions like depression, anxiety, and PTSD, along with research, it’s safe to say that this legal marketplace will rise similar to how cannabis has over the last decade or so.

For now, Oregon is the main place that allows psilocybin for medical and mental health purposes. While restrictions are in place, this is a massive step in the right direction for this industry.

Oregon therapists and other trained professionals in Oregon are now allowed to grow magic mushrooms and extract or synthesize psilocybin. But if you don’t live in Oregon, the options as a consumer and shroompreneur are more limited.

Legal mushrooms may decrease anxiety, too. For instance, Reishi mushrooms have been shown to reduce anxiety and help with other medical and mental conditions.

Mushrooms for Anxiety FAQ

Are mushrooms an antidepressant?

Mushrooms aren’t antidepressants in the clinical sense, but they can help fight depression by regulating serotonin levels. The chemical compounds in psychedelic mushrooms impact serotonin levels in the body, which means that people who take them may feel immediate relief from symptoms of depression and anxiety.

Can mushrooms be used to treat anxiety?

While scientists are still studying their impacts on mental health, shroompreneurs interested in serving anxiety patients can take advantage of the growing legal medicinal mushroom industry. Businesses participating in this developing market can provide a treatment that is both legal and natural.

Is mushroom good for depression?

Mushrooms have the opportunity to help fight depression, too. This is one of many conditions that shroompreneurs can serve in a medical context. Many people don’t realize that shroompreneurs can legally serve anxiety patients with magic mushrooms in some regions like Oregon, but some research suggests that these are the next best thing to antidepressants when it comes to depression treatment.

What can mushrooms help with?

Mushrooms have the potential to help fight anxiety, depression, and PTSD. And researchers are still learning about the therapeutic impacts of these unique fungi on mental health. While they are not available for most people outside of Oregon, coming research may pave the way for their expansion into other states.

Is Reishi Mushroom good for anxiety?

Reishi mushrooms have been shown to reduce stress and anxiety. Many people who experience debilitating symptoms of depression and anxiety may benefit from the healthful compounds in Reishi mushrooms.

Do hallucinogens reduce anxiety?

Some scientific evidence highlights that hallucinogens are capable of anxiety reductions. During a recent study in 2021, researchers questioned 164 people who had a psychedelic experience how it impacted their mental health symptoms. The participants reported significant decreases in anxiety, along with reductions in stress and depression after their psychedelic experience.

So, Can Mushrooms Be Good for Anxiety?

Yes, mushrooms can be good for anxiety. Of course, this should not be attempted without expert guidance and a doctor’s suggestion.

From a consumer standpoint, it’s easy to see how mushrooms can help anxiety. But shroompreneurs have an opportunity to serve this space, as well.

As a business, you may be able to market your products, particularly Reishi mushrooms, to consumers who suffer from anxiety. This is an excellent opportunity for business owners and entrepreneurs looking to serve anxiety patients.

If you currently operate a mushroom endeavor and would like to scale it, contact us at any time! We help shroompreneurs grow their businesses in this expanding marketplace, and we can help you too!

Are Mushrooms Good for PTSD? Shroompreneur Opportunities

Are mushrooms good for PTSD? Some are, but others, not so much. But the fact that some mushrooms can help PTSD symptoms has created a wealth of opportunities for patients and shroompreneurs.

In this post, we explain which mushrooms are good for PTSD, shroompreneur opportunities for now and in the future, and answer some frequently asked questions about PTSD mushroom applications.

Are Mushrooms Good for PTSD

Psychedelic Therapy for Trauma – Does it Work?

You may or may not have heard, but psychedelic therapy for trauma is becoming increasingly common throughout the United States. This is an opportunity for some patients who are struggling with the symptoms of PTSD and have exhausted all other options.

The therapeutic potential of psychedelics is vast. But not everyone understands how this class of psychoactives helps patients recover from trauma.

To understand psychedelics for PTSD treatment, you need to first have an understanding of trauma itself. There are many different types of trauma, including interpersonal violence or abuse, witnessing violence or abuse, domestic abuse or abuse at home, etc.

But can psychedelics replace traditional meds?

Most people agree that drugs are helpful for psychotic disorders. But what if there was an alternative to medication? This is the question researchers are trying to answer in this type of psychedelic therapy. If patients could use psychedelics to recover from PTSD, they wouldn’t have to take traditional medication.

Researchers conducted several studies on the potential of psychedelics for treating trauma with positive results. In fact, their results were so promising that some states and cities have made psilocybin mushrooms for therapeutic use legal and have called for even more research is being conducted.

So far, researchers have made some impressive progress. In one study, they gave mice some psilocybin and others a placebo. The mice that were given psilocybin overcame fear conditioning much better than the mice that received the placebo.

Through this study, the results supported that psilocybin is capable of breaking the traumatic cycle that happens in patients with PTSD and other debilitating mental disorders.

Shroompreneur Opportunities for PTSD Treatment

The PTSD therapeutics market is already quite impressive. But equally important to consider is the projections.

At this point, a CAGR of 4.5 percent is expected from 2018 to 2026. By 2026, the market is projected to hit $10,679,500,000. With this in mind, there’s a massive market currently being developed and expanded upon, and as more scientific evidence reveals how magic mushrooms can be used for PTSD, we can expect more legalization progress.

Denver already decriminalized magic mushrooms in 2019. Oakland has also made progress, as has Oregon, which was the first state to legalize psilocybin mushrooms. Detroit, Michigan has also decriminalized magic mushrooms.

While it might seem farfetched to think that psilocybin mushrooms will likely be legal in the United States, it’s important to consider legality in other countries. For instance, in Jamaica, psilocybin is legal and there has been a psilocybin nasal spray that’s used for PTSD.

As more progress is made, we can expect the United States to develop a psilocybin mushroom marketplace that’s not unlike its cannabis sector. However, just like with the marijuana space, bypassing the taboo surrounding these hallucinogens will take time.

Mushrooms for PTSD FAQ

Can psychedelics help PTSD?

While more research is essential, the results of the studies that researchers have conducted regarding psychedelics and treatment for PTSD and other mental disorders are promising. These drugs might assist in easing the impact of trauma. However, the research is still uncovering mixed results.

Can you use mushrooms for PTSD instead of medication?

Psychoactive drugs like psilocybin can help patients with PTSD break the cycle of trauma. But it is important to note that these drugs aren’t a replacement for traditional medications and a doctor should be consulted before a patient decides to stop taking prescribed PTSD medication.

How do you beat PTSD naturally?

Besides medication and psychedelics, PTSD patients have options to beat this mental illness naturally. Some decide to learn more about trauma and its role in PTSD. Joining a support group can especially helpful. Practicing relaxation techniques is also beneficial, as are outdoor activities. Abstaining from alcohol and drugs is recommended, and spending time with positive people is also conducive to beating PTSD naturally.

What drugs are bad for PTSD?

Escaping from PTSD is challenging. But this illness becomes even worse when a patient tries using alcohol or PTSD to cope with its symptoms. Particularly, alcohol and opiates tend to increase depression and anxiety while interfering with sleep patterns.

So, Are Mushrooms Good for PTSD?

The results of studies conducted with psychedelics are promising, but more research is still required. This type of medication isn’t a replacement for traditional PTSD medication and patients should consult their doctors if they’re considering attempting to use other forms of treatment.

While psychedelic mushrooms might help with PTSD symptoms, most areas in the United States have outlawed them. However, some states and cities have decriminalized psilocybin and made it legal for therapeutic use.

At this point, the opportunities for shroompreneurs looking to become established in the psilocybin mushroom space are limited. But we believe federal legalization will happen, and much like the cannabis industry, the magic mushroom marketplace will continue its expansion to become a legal space, offering new opportunities in an emerging space to those willing to seek them.

Selling Magic Mushrooms for Profit: Becoming a Shroompreneur

Selling magic mushrooms for profit isn’t federally legal at this point. However, this could change soon as activists continue to push for legalization.

Many states and cities have already begun making changes in their legislation to decriminalize, legalize, and permit more research on psilocybin mushrooms.

So, will selling magic mushrooms for profit become legal?

We believe this to be the case. But for now, the only magic mushrooms we recommend selling for profit are legal medicinal mushrooms.

Some legal medicinal mushrooms truly offer magically beneficial properties. We see more and more shroompreneurs hopping into this space with supplements and culinary mushrooms, as well as fashion brands using mushroom materials to develop innovations for the space.

Anyways, for now, selling magic mushrooms isn’t a thing – unless you’re worth risking your freedom, considering it’s prohibited. But if you’re considering delving into the mushroom space and want to sell legal mushrooms for profit, here’s some insight.

Selling Magic Mushrooms for Profit

Do You Need a License to Sell Mushrooms?

If you’re planning to sell fresh cultivated mushrooms in their natural state as a raw agricultural product, you’ll need to meet FSMA requirements. However, anything beyond that is not required. There isn’t a special inspection or license required.

Now, if you’re selling mushroom supplements, you might need something else. However, manufacturers and distributors of supplements don’t need FDA approval. These dietary supplements can be sold without it.

The FDA does not maintain a list of the manufacturers and distributors, nor the mushroom supplements they sell and distribute. But you’ll still need to include the name and address of the manufacturer or distributor on the mushroom supplement label, of course.

Most supplement lines don’t require a massive investment – and the mushroom supplement industry is no different. These operations can be started with around $5,000. However, with larger investments, the operations become easier to begin and achieve profitability.

Selling Magic Mushrooms for Profit FAQ

How much money can you make selling mushrooms?

The income for part-time mushroom growing is quite impressive. But the amount you can earn selling mushrooms depends on the type of product, your profit margins, and the demand.

For example, if you grow mushrooms, you might sell them at around $6 per pound wholesale or $10 per pound retail. If the demand is high, you can earn a significant income here. But keep in mind, you’ll still have expenses you’ll need to cover.

On the other hand, if you’re selling supplements in high demand with $14 profit per bottle, the amount you can earn will vastly differ from growing mushrooms. You’ll still have expenses for storage, distribution, marketing, etc. But these costs might be less than operating a grow facility.

Can you make money growing and selling magic mushrooms?

Mushroom cultivation, generally speaking, can be quite profitable. It’s not too challenging to learn the basics of growing shrooms, and growing them in large batches to market and sell isn’t too difficult. However, growing and selling magic mushrooms isn’t legal just yet. So, unless you’re willing to risk your freedom, we’d suggest choosing to grow legal medicinal mushrooms for the time being and pivoting to psilocybin mushrooms once they’re legal.

Is mushroom business really profitable?

Mushroom cultivation is one of the most profitable agri-business operations you can begin. And what’s more is how it requires a small investment and little space in comparison to other crops.

As a result, the part-time opportunities for this space are abundant and profitable. However, it can be quite challenging to find a lucrative market or source of demand in the mushroom industry. That’s why we recommend learning more about medicinal mushrooms and supplementing shroom sales with other products in an online setting, for example.

Concluding on Selling Magic Mushrooms for Profit

Since magic mushrooms are currently prohibited, selling magic mushrooms for profit is very risky. However, selling legal medicinal mushrooms can be very profitable while remaining legal.

With that said, you’ll still need to find a market for your products. But with the proper research, you’ll be able to do so in no time at all.

If you have a legal mushroom operation and are looking to scale in this growing space, Northstar is here to help. Our experts are helping shroompreneurs grow their operations with the right financial services, focusing on expanding and dominating in this emerging marketplace.

Magic Mushrooms for Cluster Headaches

Is it possible to use magic mushrooms for cluster headaches?

Some say, “yes.” However, more scientific research is essential to prove this anecdotal evidence.

Regardless of the current state of research, as more evidence highlights how magic mushrooms for cluster headaches work, more entrepreneurial opportunities will come to fruition. We expect federal legalization to occur as more research is done.

For now, magic mushrooms that contain psilocybin are federally prohibited. So, if you’re thinking about becoming a part of the mushroom marketplace, it’s best to do so with legal magic mushrooms.

In this post, we cover the science that shows the efficacy of magic mushrooms for cluster headaches, the opportunities, and common questions on consumers’ minds.

magic mushrooms for cluster headaches

Best Mushroom Strain for Cluster Headaches

The best mushroom strain for cluster headaches might be magic mushrooms. These psilocybin-producing mushrooms have a lot of anecdotal evidence highlighting their efficacy. But some of the science points at how this could be the best mushroom strain for cluster headaches.

Researchers from Yale University recently published a small study analyzing the utilization of psilocybin for a group of patients that have migraines. Through the survey data and anecdotal reports of the past, psilocybin has been outlined as effective for cluster headaches.

The main issue with this research is that, even though it shows that magic mushrooms for cluster headaches could help, it’s controversial. These mushrooms are hallucinogenic, and some people use them recreationally. But what’s more is that these mushrooms have current prohibited status in the United States, making them quite difficult to study.

However, in a new placebo-controlled study, scientists uncovered that psilocybin could help people who suffer from migraine headaches. This could be helpful for those suffering from cluster headaches, too.

The new findings were published in a journal titled Neurotherapeutics, offering preliminary evidence outlining how psilocybin can be utilized to provide long-lasting therapeutic benefits to migraine sufferers.

“As a headache medicine physician, I see the need for a better understanding of headache disorders, including migraine, and the need for more treatment options. I’ve also studied the neuropharmacology of psychedelics for a number of years and appreciate their ability to help us understand more about the workings of the human brain,” explained study author Emmanuelle A. D. Schindler, an assistant professor of neurology at Yale School of Medicine.

The anecdotal evidence has been circulating for years about how magic mushrooms can help lessen the symptoms of migraines. With this newly published research being the first double-blind, placebo-controlled study that examines the efficacy of psilocybin’s impact on migraines, it’s safe to say that more research will be conducted to show how it affects cluster headaches.

The Opportunity for Shroompreneurs

Coherent Market Insights (CMI) claims the cluster headache market is expected to exceed $550.1 million by 2028. In 2021, this global industry is valued at around $355.2 million. With an expected CAGR of 6.4% over the forecast period 2021 to 2028, it’s safe the say there’s tremendous potential to acquire your share of the market with magic mushrooms for cluster headaches.

We’re observing more approval for novel treatment options from regulating forces like the U.S. Food and Drug Administration, too. This is what’s encouraging the global cluster headache market growth.

With federal legalization for magic mushrooms, we can expect an incredible opportunity for shroompreneurs interested in making psilocybin products for cluster headaches. While this is a ways away, we believe it’s likely to occur in the future.

We’ve seen cities and states make impressive progress with decriminalization and legalization. This industry is set to EXPLODE! But, for now, we’ll have to wait for federal legalization to see the progress this spaces needs.

Here’s some information on the most common magic mushrooms for cluster headache questions:

Magic Mushrooms for Cluster Headaches FAQ

Are magic mushrooms good for cluster headaches?

Even though there are some risks involved with using magic mushrooms for cluster headaches, some patients have found that this works when nothing else does.

Some expert psychologists highlight that hallucinogens like LSD and psilocybin are some of the best options available. However, due to the fact that they’re prohibited, they cannot be offered legally.

What types of mushrooms for cluster headaches?

Anecdotal and scientific evidence shows that psilocybin mushrooms can help with cluster headaches and migraines. But legal medicinal mushrooms, particularly Reishi mushrooms, are also being used for this purpose. Reishi mushrooms have already been proven to completely rid people of migraine headaches without any side effects.

How do you get rid of a cluster headache fast?

Getting rid of cluster headaches fast is no easy feat. Some people try inhaling pure oxygen by breathing it in through a mask at between seven and 10 liters per minute. This can ease symptoms within 15 minutes.