Managerial Accounting II , Assignment 1

Case study Analysis: Harsh Electricals

SUBMITTED BY

ANKIT SHARMA PANKAJ JINDAL SIDDHARTH GARG UTKARSH SHARMA

19PT2-05 19PT2-23 19PT2-34 19PT2-36
IDENTIFICATION OF COSTS FROM THE CASE
S.No. Description of Cost Amount
1 Nagesh Annual remuneration (Rs.) 600,000
2 Workshop lease amount (Rs.per month) 9,600

3 Security Deposit for Warehouse rent (Rs.) 80,000

4 Cost of acquiring fixed assets (Rs.) 500,000
5 Cost of 5 labours (Rs. / Day) 1,000
6 Cost of 6 Staff members (Rs./ Month) 36,000

7 Cost of Raw Material for Standard Model (Rs. / Model) 1,778

8 Cost of Raw Material for Baleno Model (Rs. / Model) 2,185

9 Transportation Cost for Standard Model (Rs. / Unit) 889

10 Transportation Cost for Baleno Model (Rs. / Unit) 1,093

11 Drilling Cost (Rs./ Unit) 10
12 Electricity Cost (Rs./ kWh) 10
13 Annual Insurance (Rs.) 25,000
14 Miscellaneous Costs for 5000 Units (Rs.) 45,000

15 Miscellaneous Costs for every additional 1000 units 5,000

16 Distribution Cost (Rs. / Unit) 100
CLASSIFICATION OF COSTS FROM THE CASE
S.No. Variable Cost (Rs. / Unit) Amount S.No. Fixed Cost Amount
(Rs./Annum)

1 Raw Material 1,778 1 Nagesh Salary 600,000

2 Transportation 8.89 2 Lease 115,200

3 Labour 3.33 3 Electricity 37800

4 Drilling 10 4 Security Deposit 0

5 Distribution 100 5 Depreciation 86,000

6 Salary of Staff 36,000

Members

7 Insurance 25,000

8 Miscellaneous Costs 45,000

Total Fixed Costs 907,200

Fixed Cost / 4000 236.25

Units
CALCULATION OF PROFIT FROM THE CASE
 Standard Baleno
S.No. Cost (Rs. / Unit) Model Model
1 Raw material 1778 2185
2 Transportation 8.89 10.925
3 Labour 3.333 2.7778
4 Drilling 10 10
5 Distribution 100 100
Total Variable Cost (Rs. / Unit) 1900.223 2308.703
Fixed Cost (Rs. / Unit) 226.8 226.8
Cost of Electricity 19.45 24.45
Total Cost (Rs. / Unit) 2146.483 2559.953
Selling Price (Rs. / Unit) 2500 3000
Profit (Rs. / Unit) 353.517 440.047