1

A STUDY ON EFFECT OF BUDGETORY CONTROL WITH

SPECIAL REFERENCE TO HATSUN,SALEM
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CHAPTER-I

1.1 ABOUT THE STUDY

A Budget is a planned estimate expressed in financial terms for a definite

period of time.cima has defined the term budget as "quantitative expressions
of a plan for a defined period of time.It may include planned sales volume and
revenues;resourcequantities,cost and expenses;assets,liabilities and cash
flows."A budget is a quantitative plan used as a tool for deciding which
activities will be chosen for a future time period.A budget is a predetermined
statement of managerial policy during the given period which provides a
standard for comparison with the results actually achieved.

Budgeting: Budgeting is a process. This means budgeting is a number of

activities performed in order to prepare a budget. CIMA has explained
budgeting as a means of coordinating the combined intelligence of an entire
organization into plan of action based on the past performance and governed
by rational judgement of factors that will influence the course of business in
the future.

2.1 Characteristics Of Budget

 A budget is concerned for a definite future period.
 A budget is a detailed plan of all the economic activities of a
business
 Budgets helps in planning, coordinating and control.
 A budget acts as a business barometer
 Budget is a constant endeavour of the management
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2.2 Budgetary control

Budgetary Control is the process of establishment of budgets relating to
various activities and comparing the budgeted figures with the actual
performance for arriving at deviations, if any. Accordingly, there cannot be
budgetary control without budgets. Budgetary Control is a system which uses
budgets as a means of planning and controlling.

According to I. C. M. A, England, Budgetary control is defined by

terminology as the establishment of budget relating to the responsibilities of
executives to the requirements of a policy and the continuous comparison of
actual with the budgeted results, either to secure by individual actions the
objectives of that policy or to provide a basis for its revision.

Brown and Howard define budgetary control as “a system of controlling costs

which includes the preparation of budgets, coordinating the department and
establishing responsibilities, comparing actual performance with the budgeted
and acting upon results to achieve maximum profitability.”

Types of budgets
As budgets serve different purpose, different types of budgets have been
developed. The following are the different classification of budgets developed
on the basis of time, functions, and flexibility or capacity.

Classification on the basis of Time :

1. Long-Term Budgets

2. Short-Term Budgets

3. Current Budgets
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Classification according to Functions :

1. Functional or Subsidiary Budgets

2. Master Budgets

Classification on the basis of capacity :

1. Fixed Budgets

2. Flexible Budgets
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1.2 INDUSTRY PROFILE

The dairy industry plays an important role in the socio-economic development of

India. The dairy industry in India is instrumental in providing cheap nutritional food to the
vast population of India and also generates huge employment opportunities for people in rural
places.

The dairy sector in the India has shown remarkable development in the past
decade and India has now become one of the largest producers of milk and value-added milk
products in the world. The dairy sector has developed through co-operatives in many parts of
the State. During 1997-98, the State had 60 milk processing plants with an aggregate
processing capacity of 5.8 million liters’ per day. In addition to these processing plants, 123
Government and 33 co-operatives milk chilling centers operate in the State.

With the increase in milk production. Maharashtra now regularly exports milk to
neighboring states. It has also initiated a free school feeding scheme, benefiting more than
three million school children from over 19,000 schools all over the State.

Dairy Industry in India

More than 2,445 million people economically active in agriculture in

the world, probably 2/3 or even more ¾ of them are wholly or partly dependent on livestock
farming. India is endowed with rich flora & Fauna & continues to be vital avenue for
employment and income generation, especially in rural areas. India, which has 66% of
economically active population, engaged in agriculture, derives 31% of Gross Domestic
Product GDP from agriculture. The share of livestock product is estimated at 21% of total
agricultural sector.

Milk Production

 1950 – 17 million tones

 1996 – 70.8 million tones
 1997 – 74.3 million tones
 2020 – 240 million tone.
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 Expected to reach- 220 to 250 mT – 2020

 Average Productivity - 2.4 kg/day or 732 kg/lactation/cow

In recent years there has been wide spread and increasing interest through
out the world in creating newer channels of utilization for the by-products of the dairy
industry. Conversion of edible substances into non-food items is not ordinarily justifiable
especially in countries where there is an overall shortage of milk supplies. It has always been
realized that economic disposal of by-products is an essential perquisite to profitable
dairying.

Definition:

A dairy by-product may be defined as a product of commercial value

produced today the manufacture of a main product.

Ghee:

Ghee is a clarified butter fat prepared from cow or buffalo milk. The
largest ghee producing states are U.P, A.P, Punjab, Rajasthan, M.P, Bihar, Hariyana etc. The
production of ghee is higher in winter and lower in summer

Method of preparation:

Cream accumulated after few days is usually taken in a suitable vessel

and heated and stirred on a low flame to remove the moisture contain. After removing
moisture contain further heating is stopped then cooling is done. On cooling, when the
residue has settled down the clear fat is decanted into suitable containers.

Buttermilk:

a) Condensed buttermilk

It also known as semi-solid buttermilk, this is usually sweet cream

buttermilk which has been ripened and condensed (approx. 3:1) in much the same
way as concentrated sour skim milk. Alternatively, sour-cream buttermilk may be
used without ripening it, but the acidity (lactic) of the buttermilk prior to its being
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condensed should be greater than 1.6 %. This will ensure in the finished product a 5-6
per cent acidity, which is necessary for long keeping quality.

b)Soft cheese from buttermilk

The production of soft cheese from creamery buttermilk may be outlined as

follows; fresh buttermilk, obtained by churning sweet-cream butter, is admixed with
fresh skim milk in the proportion of 1:1. The mixture is pasteurized at 650C for 20
minutes, cooled to 350C, inoculated with lactic starter @ 10 per cent and allowed
setting for 3 hours. The curd is cut with standard cheese knives and the curd cubes
subjected to a cooking process during which a maximum of 400C is reached in 15-20
minutes. The curd cubes are then collected in a muslin cloth and pressed overnight,
preferably inside cold store (5-100C), to remove excess moisture. The pressed curd,
which has a rather low keeping quality, can be utilized either for direct consumption
after the addition of sugar @ 15 per cent, or in the manufacture of processed cheese
up to 10 per cent of raw cheese.

Industrial processing

Dairy plants process the raw milk they receive from farmers so as to extend its
marketable life. Two main types of processes are employed: heat treatment to ensure the
safety of milk for human consumption and to lengthen its shelf-life, and dehydrating dairy
products such as butter, hard cheese and milk powders so that they can be stored.

Cream and butter

Today, milk is separated by large machines in bulk into cream and skim milk. The
cream is processed to produce various consumer products, depending on its thickness, its
suitability for culinary uses and consumer demand, which differs from place to place and
country to country.
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Some cream is dried and powdered, some is condensed (by evaporation) mixed with
varying amounts of sugar and canned. Most cream from New Zealand and Australian
factories is made into butter. This is done by churning the cream until the fat globules
coagulate and form a monolithic mass. This butter mass is washed and, sometimes, salted to
improve keeping qualities. The residual buttermilk goes on to further processing. The butter
is packaged (25 to 50 kg boxes) and chilled for storage and sale. At a later stage these
packages are broken down into home-consumption sized packs.

Skimmed milk

The product left after the cream is removed is called skim, or skimmed, milk.To
make a consumable liquid a portion of cream is returned to the skim milk to make low fat
milk (semi-skimmed) for human consumption. By varying the amount of cream returned,
producers can make a variety of low-fat milks to suit their local market. Other products, such
as calcium, vitamin D, and flavoring, are also added to appeal to consumers.

Cheese

Cheese is another product made from milk. Whole milk is reacted to form curds
that can be compressed, processed and stored to form cheese. In countries where milk is
legally allowed to be processed without pasteurization a wide range of cheeses can be made
using the bacteria naturally in the milk. In most other countries, the range of cheeses is
smaller and the use of artificial cheese curing is greater. Whey is also the byproduct of this
process.

Yoghurt (or yogurt) making is a process similar to cheese making, only the
process is arrested before the curd becomes very hard

Milk powders

Milk is also processed by various drying processes into powders. Whole milk,
skim milk, buttermilk, and whey products are dried into a powder form and used for human
and animal consumption. The main difference between production of powders for human or
for animal consumption is in the protection of the process and the product from
contamination. Some people drink milk reconstituted from powdered milk, because milk is
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about 88% water and it is much cheaper to transport the dried product.

Other milk products

Kumis is produced commercially in Central Asia. Although it is traditionally

made from mare's milk, modern industrial variants may use cow's milk instead.

Indian Dairy Farming (2009 - 2010)

In the year 2010 Budget Dairy Industry Expectations are expected to solve some
of the crucial problems of the previous year. In 2009 the Indian dairy farming industry saw
the global economic crisis saw its effects in the dairy industry also. There was a severe
decline of prices of milk by the end of 2008 that continued through 2009. According to
experts the main reason behind the price fall of dairy produces was the excess production of
milk. Over the past few years the gap between the real farm price and retailer price has
widened. It was a situation where farmers felt deprived of their income and thus were led.

Expectations of the Dairy Industry (2010 - 11 Budget) - in the 2010 budget dairy
farm expectations are plenty. Subsidy purchase of farm equipments is expected from the
government to enable farmers mechanize units in states like Tamil Nadu, Kerala, Punjab and
Haryana. The quality of animal fodder is also expected to improve. Price regulation is
expected to lessen the cost of production as well as retail prices of dairy product.
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1.3 COMPANY PROFILE

INTRODUCTION

Hatsun Agro Product Ltd. (“the Company”) is in the business of

manufacturing and sale of Milk, Milk Products and Ice creams. The company’s brands
“ARUN” ice creams and “AROKYA” milk are leading brands in South India and enjoy
continued patronage from the customers for more than three decades.

The promoter Mr. R.G.Chandramogan started the ice cream business in

1970 from a small rented place in Chennai. Now the company has grown into a leading
private dairy in Tamil Nadu with a turnover of more than Rs.10 Billions. The company has
set the goal of exceeding Rs.20 Billions during 2012- 2013.
KEY HIGHLIGHTS
The Dairy Market
India is the largest milk producing country in the world with a milk
output of around 100 million tonnes in 2004 and the largest bovine stock population in the
world. While the world’s dairy production is growing at around 1-2% p.a., India is amongst
the highest growth dairy market with production growing at 3-4% p.a. In the wake of
subsidies for dairy products being phased out in developed countries following WTO
agreements, India is poised to play an important in the international dairy business.
The milk production and dairy business has shown a strong growth in the
last 2-3 years and is expected to be one of the fastest growing markets for milk/milk products
especially in the context of its current low per capita availability and consumption of milk
and milk products.

The future of the world dairy market is positive as demand is increasing

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and production rising in several countries. A large portion of the growth is expected to come
from the developing nations, which are expected to become hubs for sourcing dairy products
for export. The Govt. on its part have also done away with the stringent milk shed provision
from MMPO 1992 thus enabling the diaries to procure milk from anywhere in the country
without restrictions. This move is expected to improve the milk supplies to private dairies
from Co-operative sector whose track records on making prompt payments to milk producers
are not so encouraging.
Product portfolio
The Company manufactures and sells the following products:
 Ice creams under the brand “Arun”
 Standardised milk – “Arokya”
 Toned milk ,
 Cream, Butter & Ghee.
 Skimmed Milk Powder, Whole Milk Powder & Dairy Whitener

The Company’s key markets are whole of Tamil Nadu and Karnataka, and
in major cities in Kerala like Trivandrum, Quilon, etc.for milk. Ice cream is marketed through
out South India. Dairy Ingredients are marketed on all India basis and also exported to more
than 30 countries.
Arun Ice Creams:
The company has been in the Ice cream business for more than 35 years
and it is the premium product of the company. The company was the first to introduce the
“Sit & eat concept” in ice cream industry. It has been successful in giving varieties in ice
creams satisfying the tastes and preferences of various analogous groups. The brand “Arun”
is a house hold name in South India and the brand value itself worth several crores.
During the year 2008-09, the ice cream division achieved a turnover of
around Rs.555 millions and it expects to achieve a target of around Rs.680 millions during
the current financial year.
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The company also earns export revenue by exporting ice creams to

Maldives. It has been dispatching ice creams by air to Andaman Island. Arun is a familiar
brand in Brunei and Seychelles.
There are more than 70 delicious varieties like exotics, cups, bars,
delights and specialties.
Manufacturing facility
The company’s diary units are located in Salem, Madurai,
Thalaivasal, Palacode and Kancheepuram in Tamil Nadu, Belgaum and Honali in Karnataka.
The ice cream units are in Chennai and Salem. Dairy Ingredient Plants are located in Salem,
Kancheepuram and Palacode.
Key features in dairies
 Capacity to handle 25,00,000 litres of milk per day;

 Spray drying capacity of 15 MT and 20 MT cumulative of 35 tonnes per day

in Kancheepuram.

 Spray drying capacity of 25 MT per day in Salem.

 Spray drying capacity of 60 MT per day in Pala code, Dharmapuri District–

New Plant.

 Totally the company is equipped to handle 120 MT of Milk Powder and 60

MT of FAT.

 ISO 9001 certified manufacturing facility that has been extensively upgraded
in the last three years; ISO 14000 certification for environment standards: HACCP
certificate for manufacturing process for milk and ice creams

 Export Inspection Agency approval for the production facility and process.

 State of the art laboratory for process control, product quality control and
product development including Micro Biological Lab;
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 Capable of being scaled up for higher volumes and enhanced product range;

 Well-maintained assets

Milk procurement
 The Company has an excellent milk collection system with chilling centre’s in
operation.

 Chilling centre’s in more than 60 places and a fleet of more than 1,500 milk
vans on contract.

 Its milk-shed area is spread over 15 districts in Tamil Nadu and 5 in Karnataka
and covers over 3,00,000 milk producers and 2000 medium and bulk milk vendors.

 The Company is also involved in dairy extension services to farmers for the
development of livestock quality and yields.

 Besides this the company also has tie up with banks for arranging agricultural
loans to milk producers.

 More than 100 Veterinary doctors under direct employment rendering full
scale animal care to the milk producers.

Sales and Distribution Network

 The company has strong logistics and distribution network in ice cream and
milk.

 Around 1,000 exclusive ice cream parlours spreading over entire Tamil Nadu
and
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Parts of Andhra Pradesh and Karnataka cater to the needs of the consumers.

 The company has 12 Cold room distribution points, strategically located for
quick and easy distribution of its products.

 In the milk segment, the Company’s distribution network comprises of 150

wholesale distributors and over 8,500 dealers for milk.
 More than 500 milk van handling distribution and covering a distance of 250
to 300 KMs each.

 Leader in liquid milk among the private sector dairies and market leader for
southern ice cream market.

 Export of milk powder and butter oil to more than 30 countries namely Dubai,
Saudi Arabia, Iran, Ceylon, Singapore, Yemen, Thailand, Malaysia, Algeria, Canada,
Japan etc.

The company has started manufacturing value added milk powder, butter
oil, butter and ghee and has started exporting powder and butter oil to Gulf, Canada, South
Asian nations and African countries. The export potentials look very promising with the cut
back and abolition of subsidies for dairy products in American and European countries.
In addition, ARUN ice creams are available in Brunei and Seychelles and
steps are being taken to market ARUN ice creams in Singapore.
The company derives its strength from its strong rural linkage with farmers
by sheer organization of geographically penetrated milk collection network

The company enjoys excellent relation with bankers under multiple

banking and the track record of loan is standard.
Procurement
The company procures around 1.65 million litre of liquid milk per day by
directly collecting it from farmers spread over 4500 villages in south India. Hatsun has its
own infrastructure of milk collection centre & chilling centre for procuring & handling of raw
milk.
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Over 350 field's staffs are employed to ensure timely collection, testing of
milk at the point of collection, weekly payment; cattle feed sales, encouraging farmers to
grow their herd size, bank loans, animal insurance, training farmers on a better animal
management and clean milking.

Over 100 veterinary doctors and 160 inseminators under direct

employment, assist in artificial insemination, feed management, breed management,
vaccination program and render full scale animal health care.

HIGHLY SOPHISTICATED PROCESSING FACILITIES

With high-tech processing plants operating at 7 locations, Hatsun ensures

rigors testing of milk before processing.

Intensive procedures to ensure the purity of milk with handling capacity

of 1.7million litre of milk per day, proves Hatsun's unyielding commitment to quality. The
facilities comprise of highly advanced technology from westfalia called Bactofuge which
bacteria clarifies the milk resulting in a high quality end product.

There are state-of-the-art laboratories (chemical & microbiological) for

process control, product quality control and product development. Validations of critical
parameters are also done at our fully quipped central lab located at Chennai. These ISO
22000:2005; 9001:2000, 14001:2004 and HACCP certified manufacturing facilities have
been regularly upgraded to meet the requirement & standards of various large multinational
companies.

Summary

Industry Dairy & Dairy Products–Liquid Milk, Ice creams and

Milk Products

Business Processing of liquid milk and marketing and distribution

of milk in sachets under popular brands “Arokya”.
Manufacture and marketing of ice creams under brand
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“Arun”

Registered No. 5-A Vijayaraghava Road, T. Nagar Chennai – 600

Office 017
Tamilnadu, India
Phone: 91-44-2815 0014, Fax – 91-44-2815 2508
Web site: www.hatsun.com

Nature of Dairy and Food Processing

Industry

Hatsun is a listed company, having listing arrangements in Mumbai

Stock Exchange. The company came out with its IPO in January 1996 with issue price of
Rs 45/= per share.
Currently, the shares are traded at Rs 105/- level (face value Rs.2/- each)
stock split on 24th June 2008.
Our Auditors are SRB & Co. (E&Y) and the company believes in
strong corporate governance and transparency in operations keeping value to investors
and lenders in mind.
The Board is broad based with independent directors forming 50% of
the Board. The company is managed by professionals drawn from various disciplines.
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1.4 OBJECTIVES OF THE STUDY

 The purpose of the study is to analyze the effect of budgeting and budgetary
control in improving organization effectiveness and profitability of the business
 To analyze the effect of budgeting in improving organization effectiveness
atHATSUN.
 To understand the role of budgetary control in minimizing the cost and
maximizing theprofitability of the business at HATSUN
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1.5 SCOPE OF THE STUDY

 The study will reveal the budgetary control of Hatsun agro products ltd.

 It will help to point out the problems and take necessary action by the company.

 This will helps to know the current and future budgetory position of the company.

 This study will helps to know the financial needs for future operation and give
clear idea for sourcing funds for these needs.
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1.6 LIMITATIONS OF THE STUDY

 Chances of personal bias while responding to a questionnaire.

 Figures arrived in fractions are rounded up.
 Times and cost constraints.
 The results of the study are applicable to the particular department of the
Company that too during the period of study.
 The study is purely based on the workers, which may be biased after the time of
Study.
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CHAPTER-II

REVIEW OF LITERATURE

Budgeting and budgeting control is an important and essential tool in the

management and administration of every organization, irrespective of size, goals or
shares ownership. Budgets as financial plans that guide estimated revenues and
expenditures over a period of time have been in use for a long time. Since their initiation
in the 1920s every organization has made them the integral part of their planning and
control system (Drury, 2004). Manso (2014) adds on that the ability of budgets to
coordinate the allocation of resources through internal communication while at the same
time serving as a means of expenditure authorization and evaluation base has made them
the most important tool that is at the managers' disposal when running an organization. It
is this importance that has added value to the longevity of budgets and made them
remain unchanged in their use

since the first days of their existence, especially in the top-bottom management approach
(Drury,2004).

Educational organizations use management accounting techniques to assess their

operations. The management accounting techniques such as budgeting help organizations
to plan, direct and control their operational activities, so as to achieve the objective of
cost minimization (Manso, 2014). Wood and Sander (1998) argue that in preparing
budgets managers must consider sales demands since production is geared towards the
quality of products demanded. But for the education sector, managers must consider
financial investment in human resource, quality of teaching and learning materials and
infrastructure. Therefore, the system of controls and the resulting management style
within an organization can either be an inhibitor or facilitator of an organization's
strategic initiative (Anthony and Govindarajan, 2003).

Budgeting promotes planning and controlling of the activities of the organization

(Manso, 2014). According to Hope and Fraser (2000), all organizations regardless of the
size need to develop a plan. Manso (2014) asserts that planning is one of the most
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important functions of management. It is a necessary requirement for management

control. As organizations such as colleges and universities grow in size, budgeting also
becomes a critical issue. Large colleges or universities can not only rely on the work of
the top administrators to plan for the entire organization. Gyasi (2005) viewed budgeting
as the process of preparing an organization’s plan of action for the future period. This
means that the organization makes an effort to come up with what it intends to do and
achieve in the nearest future.

Once a budget has been adopted it becomes an important part of evaluating

performance. It, therefore, promotes efficiency and serves as a deterrent to waste and
inefficiency (Weygandt, Kieso, and Kell, 2008). The success of the budget process
depends on the managers’ success in setting appropriate targets for which they are held
accountable (Manso, 2014).

1.1 Characteristics of a budget

Gregory (2005) gives characteristics of a good budget as comprising of the following;

participation which involves as many people as possible in drawing up a budget,
comprehensiveness embraces the whole organization, standards is based on the
established standards of performance. Other characteristics are flexibility which allows
for changing of circumstances, feedback which must constantly monitor performance
and analysis of costs and revenues.

1.2 Types of budgets

Gregory (2005) identified two main types of budgets. These being the traditional budget
and the medium Term Expenditure Framework. A traditional budget is a tool used by
money experts to get your financial situation on track (Anohene, 2011). The traditional
budget can further be categorized into the following:

Fixed budget
Fixed budgets are often used by firms which rely on their forecasts. Hofstede (1968)
inscribes thatone deliberated issue in the accounting works is whether a budget should be
fixed or variable with respect to volume or sales or other inputs. The fixed budget is thus
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a budget which once made and accepted cannot be changed for whatever reason being
that fixed cost is sustained and still persistsirrespective of sales volume.

Flexible Budget

In the opinion of Garrison (2000), a flexible budget mirrors the outcome of changes in
the budgeting situation which affect the performance of the budget, it does not confine
itself to only one level of activity and actual results do not have to be compared against
budgeted costs at the original activity level.

Capital budget

Pandy (1999) defines capital budgeting as the firm’s decision to invest an entity’s
current funds most efficiently in long-term activities in anticipation of an expected flow
of the future benefits over a series of years.

Sales budget

Stanton (1971) comments that the basis of successful marketing planning in a firm is the
measurement and forecasting of market demand. The significant figure required is the
sales forecasts because it is the basis for all budgeting and all operation in the firm.
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CHAPTER-III
RESEARCH METHODOLOGY
MEANING:
Research methodology is the way to solve the research problems. It may be
understood as a science of studying how research is done scientifically primary and
secondary data were made use of along with data collection are alone through questionnaire
and internet.
3.1 RESEARCH DESIGN
Research is the systematic and logical study of an issue or a problem to arrive at
accurate results. Research the job of collecting, recording and analyzing relevant data to
arrive at decisions. The present study is a systematic, objective and exclusive search for
studies of the facts relevant to a problem in the field of marketing. The search for the fact
may be through either(1)Unscientific method (2)scientific method
DESCRIPTIVE RESEARCH:
The study comes under the Descriptive research includes survey and fact finding
enquired of different kinds the major purpose of descriptive research is the descriptive of the
state of affairs as it exists at present.
3.2 SAMPLE DESIGN
Sample design depends on the researches objective and the nature of problem
samples are selected by using simple random sampling method.
3.3 DATA COLLECTION
Data constitute the foundation of the research. Hence the first step was to gather the
required data. The study was conduct at HATSUN ,the data or information collected from the
various sources were divided in to two parts.
 Primary Sources
 Secondary Sources
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PRIMARY DATA
The primary data means directly collected by the researcher himself or by investigator
appointed by him from the original sources.
QUESTIONNAIRE
A questionnaire is a printed list of question related to particular enquiry.
SECONDARY DATA
The secondary data is information which already exists. The secondary data was
collected from journals, magazines, books. The research specific information was less
available more emphasis was given on primary data.
SAMPLING UNIT
One of the unit in to which an aggregate is divided or regulated as divided for the
purpose of sampling.
SAMPLE SIZE
The Sample of 100 respondents was selected using simple random sampling method.
3.4 TOOLS TO BE USED
 Percentage Analysis
 Chi-Square Analysis
 Correlation Method
PERCENTAGE ANALYSIS
Percentage refers to the special kind of ratio. Percentage is used in making
comparison between two or more series of data percentage can also be used for compare the
relative teas, the distribution of two or more series of data.
The easy and simplicity of calculating the general understanding of its purpose and
the universal applicability of the percent static have made it most widely and standardized
tool researches everything to a common based and thereby allow meaningful comparison to
be made with data.
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PERCENTAGE METHOD IS USED FOR DATA ANALYSIS:

No of respondent
Percentage = *100
Total No of respondent

CHI- SQUARE ANALYSIS

This is one of the most widely used statistical tool used for the purpose of analyzing
the data. This is one of the simple methods of calculating and comparing the data.
IN THAT WE SHOULD UNDERSTAND THE FOLLOWING
E- Expected Value
O- Observed Value
H0- Null Hypothesis
H1- Alternative Hypothesis
2- Calculated Value
DOF- Degrees Of Freedom
Level Of Significance- 5
The formula for computing chi-square is:
(O - E) 2
X2 = ∑ ----------
E