8/3/2019 Costing Amul

http://slidepdf.com/reader/full/costing-amul 1/31

Presented By:

Hiral Mehta 61

Saurabh Mehta 62Poonam Mishra 63Parinaaz Mistry 64

Hemal Muchalla 65Bhakti Shah 89

AMUL ICE CREAM

8/3/2019 Costing Amul

http://slidepdf.com/reader/full/costing-amul 2/31

ContentsOverview of the Industry

About the Company

About Amul Icecream

Cost sheet and analysis

SWOT analysis of AMUL

8/3/2019 Costing Amul

http://slidepdf.com/reader/full/costing-amul 3/31

Overview of Ice Cream Industry 

Indian ice-cream industry is very old started in un-organized developed into an organised sector.

Ice Cream market is growing at 26%

market size -1200 crores

Major players:Amul

HLL - Kwality Walls

Mother Diary

8/3/2019 Costing Amul

http://slidepdf.com/reader/full/costing-amul 4/31

west

40%

north

30%

south

20%

east

10%

west 40

north 30

south 20

east 10

Ice Cream Consumption in the Regions

8/3/2019 Costing Amul

http://slidepdf.com/reader/full/costing-amul 5/31

About The Company 

Gujarat Cooperative Milk MarketingFederation (GCMMF)

AMUL means "priceless" in Sanskrit.

Turnover of Amul was Rs. 52.55 billion in2007-08

Various other products under brandname amul.

8/3/2019 Costing Amul

http://slidepdf.com/reader/full/costing-amul 6/31

Various products under the brand name Amul

Amul products have been in use in millions of homessince1946.

Amul Butter

Amul Milk

Amul Cheese

8/3/2019 Costing Amul

http://slidepdf.com/reader/full/costing-amul 7/31

Amul Chocolates 

Amul Shrikhand,

Amul Ice creams

Amul Masti Dahi

Amul Ghee

Amul Kool Cafe

8/3/2019 Costing Amul

http://slidepdf.com/reader/full/costing-amul 8/31

About Amul Icecream

Amul Ice Cream was launched on 10th March, 1996 inGujarat.

Amul - Market Leader with share of 38%

HLL - Kwality Walls - 2nd biggest player

Has combated competition like Walls, Mother Dairy andachieved the No 1 position in the country in 2001 .

-reasons:-

reasonable pricing, quality of products &

the brand name.

8/3/2019 Costing Amul

http://slidepdf.com/reader/full/costing-amul 9/31

Various Ice Cream Range of Amul

8/3/2019 Costing Amul

http://slidepdf.com/reader/full/costing-amul 10/31

Market Share of Amul Ice Cream against kwalitywalls

8/3/2019 Costing Amul

http://slidepdf.com/reader/full/costing-amul 11/31

Assumptions

All raw materials consumed in production of ice cream.

The production and sales units are same.

8/3/2019 Costing Amul

http://slidepdf.com/reader/full/costing-amul 12/31

Cost Sheet

8/3/2019 Costing Amul

http://slidepdf.com/reader/full/costing-amul 13/31

Cost Sheet Cont…. 

8/3/2019 Costing Amul

http://slidepdf.com/reader/full/costing-amul 14/31

Series1,

DIRECT

COST, 55.55,55%

Series1,

INDIRECT

COST, 45.45,

45%

Classification of Total CostDIRECT COST INDIRECT COST

8/3/2019 Costing Amul

http://slidepdf.com/reader/full/costing-amul 15/31

ANALYSIS OF COST SHEET

Direct Cost

8/3/2019 Costing Amul

http://slidepdf.com/reader/full/costing-amul 16/31

Analysis of Cost Sheet

Direct materials

To manufacture one ice cream cup below are the componentsor raw materials required with their unit cost :

Dry Fruits – 3 %

Milk – 70% Flavours – 5 %

Sugar – 16 %

Cup – 2 %

Other ingredients – 4 %

8/3/2019 Costing Amul

http://slidepdf.com/reader/full/costing-amul 17/31

Analysis of Cost Sheet 

Direct Labour

There are 17 workers employed in the production of theice cream and each worker is paid Rs 2000 per month .

Direct Costs or expenses 

The direct cost includes costs incurred in bringing theraw materials into the factory ie. Carriage inward. Theraw materials are purchased every month and costs

involved for carriage are Rs 1840.

8/3/2019 Costing Amul

http://slidepdf.com/reader/full/costing-amul 18/31

Series1,

factory/worksoverheads,

49.2134, 49%

Series1, office

and

administrative

overheads,

6.5725, 7%

Series1, selling

and

administrative

overheads,44.2147, 44%

Distribution of Indirect Cost

factory/works overheads

office and administrativeoverheads

selling and administrative

overheads

8/3/2019 Costing Amul

http://slidepdf.com/reader/full/costing-amul 19/31

ANALYSIS OF COST SHEET

Indirect Cost – Factory Overheads

8/3/2019 Costing Amul

http://slidepdf.com/reader/full/costing-amul 20/31

Analysis of Cost Sheet 

Indirect Costs

1. Factory Overheads

The Factory Overheads includes the indirect labour,factory rent, insurance and depreciation on machinery,power, factory supervisor’s salary ,packing material,ware house expenses and other factory expenses.

Indirect labour : This includes 3 sweepers whoseaverage salaries are Rs. 1000 each.

8/3/2019 Costing Amul

http://slidepdf.com/reader/full/costing-amul 21/31

Analysis of Cost Sheet 

Insurance: The total insurance amount is Rs 15000.

Break up of the total insurance amount for Machinery1200000.

Land : 500000(1000 sq. ft. * Rs. 500 per sq. ft.)

Depreciation on machinery : There are 6 machines in

the factory ,one machine is used for making ice creams

which is Boiler and other are Refrigerators . The cost ofBoiler is Rs 300000 and Refrigerators are worth of Rs.900000. The depreciation method followed is SLM @ 7%.

8/3/2019 Costing Amul

http://slidepdf.com/reader/full/costing-amul 22/31

Analysis of Cost Sheet 

Power & Fuel: The monthly average cost of powerconsumption of the factory is Rs 42375.

Supervisor’s salary : The factory has 2 supervisors andsalary of each supervisor is Rs 2500.

Cost of maintenance : oiling and cleaning of machinery

and other miscellaneous expences for maintainance

8/3/2019 Costing Amul

http://slidepdf.com/reader/full/costing-amul 23/31

ANALYSIS OF COST SHEET

Indirect Cost – Office & Administrative Overheads

8/3/2019 Costing Amul

http://slidepdf.com/reader/full/costing-amul 24/31

Analysis of Cost Sheet 

Indirect Cost

2. Office and administration overheads

Office and administration overheads include office rent,salary to staff, office and general expenses, printing andstationary, telephone expenses, electricity and lightings.

Office rent: The per sq.ft rate of the Office is Rs 18.Thearea of the factory is 300 sq.ft.

8/3/2019 Costing Amul

http://slidepdf.com/reader/full/costing-amul 25/31

Analysis of Cost Sheet 

Salary to staff : the office staff has three employees. Apeon, clerk and an Accountant and the salaries are Rs800, Rs 2200 and Rs 4000 respectively.

Office and general expenses: This compriserefreshments(tea and snacks).

Telephone Expenses:- Calls made by the staffmembers.

Electricity and lightings:- It consists of office lightingand air conditioning expenses.

8/3/2019 Costing Amul

http://slidepdf.com/reader/full/costing-amul 26/31

ANALYSIS OF COST SHEET

Indirect Cost – 

Selling & Distribution Overheads

8/3/2019 Costing Amul

http://slidepdf.com/reader/full/costing-amul 27/31

Analysis of Cost Sheet 

Indirect Cost

3. Sales and distribution overheads

Sales Commission : As a part of encouragement forsales people ,they are given commission of 2.5 % ofthe total sales done by them.

Discount allowed : To attract retailer to buy the

product they are offered a discount of 5% on theselling price.

8/3/2019 Costing Amul

http://slidepdf.com/reader/full/costing-amul 28/31

Analysis of Cost Sheet 

Salary of salesmen : The company has 5 salespersons and they are paid a salary of Rs 3500each per month.

Carriage outward: To carry the finished goodsto the whole sellers , the transportations chargeper unit/product is set as Re 1.24

 

8/3/2019 Costing Amul

http://slidepdf.com/reader/full/costing-amul 29/31

It is a family brand.

Available in many flavors and sizes.

They have sugar free probiotioc ice-creams.

Low calorie ice-cream.

Available in reasonable prices.

Does not have many outlet centers.Poor Packaging .

Durability (melts very fast).

Come up with more fruit flavors.

Having more number of amul outlets.Better advertising.

Changing the target audience(focusing more on youth andchildren).

Competition from existing players – 

 Branded and Unbranded (mewad).

Foreign players entering the market(Geleto , Baskin Robbins).

SWOT

ANALYSIS

WEAKNESS 

OPPORTUNITIES 

THREATS 

STRENGHTS

8/3/2019 Costing Amul

http://slidepdf.com/reader/full/costing-amul 30/31

Refrence

www.amulicecream.in 

Annual report of Amul 

Cost accounting and financial management-Ravi 

kishore  –

edition 5 

8/3/2019 Costing Amul

http://slidepdf.com/reader/full/costing-amul 31/31