Table of Contents

1.The Company………………………………………………………………..………………………………………………..1

1.3 Vision

1.6 International business

2. Manufacturing Process

2.1 About Airend.............................................................................................................................21

2.2 Size............................................................................................................................................23

2.3 Application................................................................................................................................23

2.4 Control Schemes.......................................................................................................................24

2.5 Process flow..............................................................................................................................26

2.6 Testing......................................................................................................................................29

2.7 Painting Process........................................................................................................................29

2.8 Packaging..................................................................................................................................30

3. Method of Cost Computation………………………………………………………………………………………….33

3.1 Cost Systems.............................................................................................................................34

3.2 The Method Followed For Cost Computation: Job Costing.......................................................35

3.3 Calculation of Costs...................................................................................................................38

3.4 Method of Computation of Total Cost......................................................................................42

Y4. Calculation of Operating Rates….

…………………………………………………………………………………….44

4.1 Break Down of Costs.................................................................................................................46

4.2 Determination of Operating Rates for each Work Centre.........................................................47

4.3 Ascertaining Suitable Drivers for Assigning of Operating/Conversion Cost..............................47

4.4 Allocation of Cost of Income Statement with the best suitable driver......................................48

5. Calculation of Cost of Different Equipments…………………………………………………………………...55

6. Ways of Computation of Production

Hours…………………………………………………………………….61Y

6.1 Computation Methodology.......................................................................................................63

7. Ascertainment of Practical Capacity………………………………………………………………………………

64Y

7.1 Conventional Approaches of Capacities....................................................................................65

7.2 Optimization of Practical Capacity............................................................................................68

Y8. Cost Control

Techniques………………………………………………………………………………………………….71

8.1 Budgetary Control.....................................................................................................................72

8.2 Variance Analysis......................................................................................................................73

8.3 Variation of Price......................................................................................................................74

8.4 Inventory And Material Management......................................................................................75

8.5 Fundamental of working capital...............................................................................................75

8.6 Three main components of the inventory................................................................................75

9. Suggestions…..……………………………………………………………………………………………………………..…77

10. Conclusion…………………………………………………………………………………………………………………….81

11. Bibliography………………..……………………………………………………………………………………….……….82

12. Annexure……………………..……………………………………………………………………………………………….83

List of Figure and Tables

YTable 1. Proforma to Calculate cost of Raw Material...................Error! Bookmark not defined.

Table 2. Proforma to Calculte Total Cost of Component.................Error! Bookmark not defined.
YTable 3. Classification of Costs......................................................Error! Bookmark not defined.
YFigure1. Ratio of Different Manufacturing Cost............................Error! Bookmark not defined.
YTable 4. Cost of Airend 001........................................................................................................57
Table 5. Cost of Airend 002...........................................................................................................58
Table 6. Cost of Airend 003...........................................................................................................59
Table 7. Cost of Airend 004...........................................................................................................60
Table 8. Cost of Airend 005...........................................................................................................61
YTable 9. Work Centre and Production Time..............................................................................67