2SD20BA038

VISVESVARAYA TECHNOLOGICAL
UNIVERSITY
Jnana Sangama, Belagavi – 590018

A PROJECT REPORT ON
“COST, VOLUME AND PROFIT ANALYSIS”
Submitted in partial fulfilment of the requirement
for the
Award of the degree in
MASTER OF BUSINESS ADMINISTRATION
Submitted by
Rakesh Sadare
(2SD20BA038)
Under the guidance of
Dr. Saleem G. Sonnekhan
DEPARTMENT OF MANAGEMENT
STUDIES SDM COLLEGE OF
ENGINEERING AND TECHNOLOGY,
DHARWAD-580002.
(An Autonomous Institution affiliated to
VTU,Belagavi.)
2021-22
SDM COLLEGE OF ENGINEERING
AND TECHNOLOGY, DHARWAD-
580002
(An Autonomous Institution affiliated to VTU, Belagavi – 590018)
Department of Management Studies
CERTIFICATE
Certified that this report on the Project entitled “COST, VOLUME AND
PROFIT ANALYSIS” is a bonafide work presented by Mr. Rakesh
Sadare (2SD20BA038) student of 4th Semester, Department of
Management Studies, SDM College of Engineering and
Technology, Dharwad, for the partial fulfilment of the requirements
for the completion of MBA Course, during the academic year 2021-
22. The report has been thoroughly reviewed and it is approved that
the report satisfies the necessary academic requirements prescribed for
the said course.
Signature of the Guide Signature of the Director Signature of the Principal

Dr. Saleem Dr.Prakash H.S Dr. K.Gopinath
Sonnekhan
Examiner I Examiner II
Signature
with date:
Name:
CERTIFICATE
DECLARATION
I Rakesh Sadare, hereby declare that the project report entitled “COST,
VOLUME AND PROFIT ANALYSIS” with reference to HANGYO ICE
CREAM PVT LTD at village Hosalli, Kirwatti, is an original work done by

me under the guidance of Dr. Saleem Sonnekhan Assistant Professor in the
Department of Management Studies, SDM College of Engineering and
Technology, Dharwad and this project work is submitted in the partial
fulfilment of the requirement for the award of the degree in Masters of
Business Administration from Visvesvaraya Technological University,
Belagavi.
I further declare that this project is based on the original study undertaken by
me and has not been submitted for the award of any degree/Diploma from
any other University/Institution.
Place: Dharwad Rakesh Sadare
Date: (2SD20BA038)
ACKNOWLEDGEMENT
The success of the any project depends on largely on the guidelines &
encouragement of many others. I take opportunity to express my gratitude to
the people who have been instrumentals in this successful completion of
project.
I would thank the entire Management of HANGYO ICE CREAM PVT LTD for
giving me the wonderful opportunity to work on summer internship of Six
weeks project in their reputed company. My Special gratitude towards
Branch Head Mr. Veerkumar Patil who has supported me in the each stage of
the internship. I obligated to Sir for giving this project & guiding me
throughout my internship projects. His encouragement, guidelines, time &
efforts motivated me to work sincerely in this project.
I would like to thank my project guide Dr. Saleem Sonnekhan Sir for his constant
follow- ups, encouragement, motivation, support & guidelines to project within
allotted time frame.
I would like to thank Director Prakash H.S sir of the Department of MBA for
giving me chance to gain exposure in this corporate world.
I would like to thank my college, SDM College of Engineering & Technology

for given me this opportunity to put practice the theoretical knowledge that I
learned from MBAprogram.
RAKESH SADARE
(2SD20BA038)
A STUDY ON COST, VOLUME AND PROFIT ANALYSIS
Chapter
Title of the chapter Page No.
No.
1 Executive Summary 1-6
2 Industrial Profile 7-10
3 Company Profile 11- 35
Theortical Background And Literature

4 36-49
Review
Data analysis, Interpretation and

5 50-72
Representation of Data
6 Findings, Suggestions and Conclusion 73-76
7 Bibliography 77-78
1
CHAPTER-1
EXECUTIVE
SUMMARY
2
Executive summary
Hangyo ice creams Pvt, Ltd, is a flagship company of Srikrishna Group,
which is 100crore entity with interests spanning various sectors like milk and milk
products, ice creams and fresh foods, restaurants and hospitality. Hangyo Ice Cream Pvt,
Ltd, Karnataka's first private ice cream factory in the organised sector, shares the same
pioneering legacy as Srikrishna Group. Hangyo is a leading ice cream brand appreciated
by people from all walks of life in its fast-developing market, which includes the states of
Karnataka, Kerala, and Goa. Hangyo Ice Cream comes in a range of packaging options,
including cups, cones, and candies. There are currently 138 different ice cream flavours
available in this novelty, as well as larger take-home family packs.
Hangyo Ice Creams are now sold along the coast of Karnataka, from
Mangalore to Karwar, as well as in important cities such as Bangalore, Mysore, Bagalkot,
and Bijapur. Athani, Navalagond, Naragund, Ranebennur, and Gadag are among the small
towns covered. And then there's Maharashtra, which includes Kolhapur.
Cost, volume, and profit analysis is a vital tool for delivering helpful
information to management for profit planning decisions. Profit is the outcome of several
factors relating to the firm's available resources, and this study will assist in determining
how efficiently the company can use its resources at the lowest cost. The following
elements will have an impact on the company's profit:
Selling price
Total cost of production
Efficiency and productivity of the firm
To make efficient planning decisions, management must do a cost volume and
profit analysis. This analysis explains the relationship between the firm's expenses,
revenue, and profit. Cost volume and profit analysis provides a holistic view of a profit
structure, allowing management to differentiate between the effects of sales, volume,
function, and price or cost adjustments on profit.
Objectives of study:
1) To identify the relationship between cost, volume & profit

2) To determine the point at which the company's sale will break even.
3) To suggest the company that the how much sale volume is required to achieve desired
level of profit
3
Need of study:
Need of cost, volume & profit analysis is to examine that how much is the cost required
and how much is the sale volume is required to break-down the break-even point of the
business. Study of cost volume and profit analysis is performed by using the balance sheet
of Hangyo ice-creams Pvt. Ltd. This analysis is done through Break-even analysis. This
analysis will studying the variable cost, fixed cost, contribution, profit volume ratio,
desired level of profit
Scope of the study
The scope study's goal is to use the current year's Cost, Volume, and Profit analysis to
create a budget for the next year. Also, for determining a target sale for the following year,
this study shows how much output is required to meet the target. We can achieve high
production at a cheaper cost with the help of this analysis, and it will serve as a benchmark
for the company.
Limitations:
1. This study is mainly concentrating on cost incurring from production to

distribution
2. The financial data required for the study has been obtained from the secondary data
or source only viz. Profit and Loss Account and Balance sheet.
3. This study is limited of ratio analysis of five years
4. The limitations of ratio analysis and Break Even Analysis are also applicable to this
study
RESEARCH METHODOLOGY:
Secondary data:
Profit and loss account, balance sheet of the Hangyo ice creams PVT. Ltd, company
information collected through Internet, through the knawels, taking a suggestion from a
guide, graphs, and charts using Ms-excel. The study is mainly concentrated on Profit
analysis of the company so the period covered is for a 5 year of a profit and loss account to
analysis the performance of the company
4
Findings:
 The company sale is increasing year by year as par my observation the

company made a sale of, 72,58,192, lac. Litters during the year 2017,
84,71,548, lac. Litters during the year 2018, and 92,58,447 lac. Litters, in the
year 2019 , 59,31,678, lac. Litter in the year 2020, 66,42,158 lac litters during
the year 2021,
 The revenue of the firm is also increasing year by year, in the year 2017 ₹
68,62,41,510, year 2018 ₹ 85,27,52,975, year 2019 ₹ 106,61,97,141, 2020 ₹
47,83,58,628, 2021 ₹ 58,29,48,894,
 Variable Cost of production is changes according to the changes in output that
is :
 Material cost 2017 5%, 2018 6%, 2019 is 5%, 2020 it is 6%, 2021 –
5%,
 Processing cost 2017 5%, 2018 6%, 2019 is 5%,2020 is 6%, 2021 5%,
 Transportation cost of 2017 7%, 2018 7%, 2019 is 6%,,2020 is 7%,
2021 7%,
 Workers cost of 2017 9%, 2018 10%, 2019 is 10% , 2020 is 5%, 2021
7%,
 Selling expenses of 2017 7%, 2018 8%, 2019 is 10%,,2020 is 4%,
2021 5%,
 Variable cost per unit of production is going to increases every year that is in
2017 - 91rs, 2018- 93rs, 2019- 107rs, 2020- 71rs, 2021 -81rs,
 Fixed cost of production in total fixed cost change as follows
 Finance cost of 2017 20%, 2018 24%, 2019 is 23%, 2020 is 47%,
2021 25%,
 Deprecation of 2017 80%, 2018 76%, 2019 is 76%,2020 is 53%, 2021
75%,
 Every year company is able to achieve the profit because company revenue is
more than the break-even point except during the year 2017.
5
 Company has a problem with its profits because company is inconsistent in its
profit makings. In the year 2017 ₹ 33,83,861, year 2018 ₹ 1,28,50,157, year
2019 ₹ 1,21,76,276. 2020 ₹ 28,40,784 Lac, year 2021 ₹ 52,84,860 Lac.
 In the year 2017 company profit decreased to 0.37% compare to year
2021 profit
 In the year 2018 profit is increased to 1.92% as compared to year 2018
profit
 But again in the year 2019 profit decreased to 1.15% compare to year
2018 profit
 In the year 2020 company made a profit 1.80%
 But in the year 2021 profit is decreased to 0.12% compare to year 2020
profit
Suggestion:
 If possible, at the peak season company must have a plan to produced ice creams at
a night shift between 10pm to 6am because at that time Government gives a
discount in electricity charges that is 5.75 rs per unit
 Company has to take a decision on controlling the finished goods inventory
because closing stock increases the carrying cost
 Company should concentrate on Selling expenses because it is going to increase
year by year
 Company should take necessary action controlling labour expenses because it is
also increases year by year
 Company should plan for manufacture a cups, lids, boxes which will use for Ice-
cream production
6
Conclusions:
The study was done in at HANGYO ICE – CREAMS PVT. LTD. Using the
company's profit and loss statement for the past five years, determine the company's cost,
volume, and profit relationships.
Following the study, it was discovered that the company has a constant cost homogeneity
as long as it generates profit. To maximise profit, total cost of production should be
reduced, particularly in terms of selling and labour expenses. The corporation should make
every effort to lower its selling and labour costs in order to maximise profits.
As a result of this study, the company or management is able to forecast profit based on
volume generated and set product prices. However, by giving this analysis report to the
management, the manager may readily make a decision about how cost should be used to
increase profit.
7
Chapter - 2
Industrial Profile
8
HISTORY OF ICE CREAMS:
People have always sought relief and a way to cool off during the summer heat and
extreme heat waves. This pursuit led to the creation of several new technological gadgets
and customs, but only one of them captured our imagination and desires, allowing
everyone to enjoy their movement in the sun and cool off like never before; this is the
story of ice cream.
The earliest ice cream was prepared from sweetened water that had been frozen, mashed
into small bits, and then topped with various flavour toppings and fruits around 2500 years
ago in ancient Persia. Over time, producing ice cream became a tradition in the Greek and
Roman empires. Ice cream was embraced with wide arms and consumed generously by
Roman nobles and monarchy, who had the financial means to fund the extremely
expensive procedure of prying open the ice cream. Unfortunately, coordinated ice delivery
from mountains to cities below halted after the Roman Empire, and ice cream became
much more expensive. Things didn't change much in the 1000 years after Rome fell, and it
wasn't until Europe emerged from the Dark Ages that things started to change.
Ice cream has been around since the 4th century B.C. Macro ns heard about the Chinese
technology of making ice and milk mixtures in the 13th century and brought it back to
Europe. It became a popular delicacy in Italy and France.
Ice creams is known as a seasonal product where the demand of the ice creams are
increase in the summer season and it effect the profit of the company however with
innovative frozen variants consumer enjoying it in the winter and rainy season.
According to the IMARC data, global ice cream consumption increased by 6.0
percent from 2009 to 2018. Due to innovation, flavours, and other factors, the market
reached 19.7 billion metric tonnes in 2018 Asia Pacific, North America, Europe, Latin
America, the Middle East, and Africa are among the important regions studied in the
IMARC report. Asia has the world's largest market.
9
ICE CREAM INDUSTRY IN INDIA
India's ice cream sector might be a lucrative market for agricultural and food exporters
from the United States. The country's trade liberalisation is boosting the sector's growth
and diversification, with customers able to choose from a wide range of ice cream flavours
like vanilla, strawberry, butterscotch, and chocolate. High tariff rates and insufficient
distribution channels continue to be obstacles for the import business, but an increasingly
wealthy younger generation of consumers will surely boost ice cream sales.
Amul, Quality Walls, Mother Dairy, Vadilal, and other regional Indian brands continue to
dominate the Indian market. Both Hindustan Lever Ltd (HLL) and the Gujarat cooperative
Milk Marketing Federation (GMCCF) have competed over their respective brands, Quality
Wall's and Amul, claiming to be market leaders in the Rs 1000 crore domestic ice-cream
market, with the organised sector accounting for Rs.650 crore.
Amul's summer growth strategy has been to provide international variety at pricing
competitive with the Indian market. Amul, according to Sodhi, is up to 50% cheaper than
comparable brands like Quality Walls. And the company isn't taking any chances, with a
flurry of new flavours set to debut this summer. Amula's ice cream is inspired by Dreyer
TM, Ben & Jerry's, and Haagen-Dazs, and comes in 100 ml cartons with flavours like
Alphonso Mango, Date with Honey, Fig, Cheese with Almonds, and even Rajbhog..
India’s ice cream market all around 3000cr, in organized &unorganized sector. Major ice
cream markers are Amul, Mother Dairy, Vadilal, cream Bell, Baskin Robbins, etc. the
capital consumption of the ice cream ice quite low. The global average of ice cream
consumption is 2300ml but India is still at a level of 400ml per capita consumption.
Low income, high prices, non-availability of good product, poor distribution and
transportation are making low consumption of the ice cream product.
Frozen yogurt is one of the fastest developing sustenance classes in India. From April to
June high demand for the product &November to July is the lean months
10
Top 10 ice-creams brands in India:
1. Amul
2. Mother dairy
3. Hindustan Unilever Brands
 Cornetto
 Magnum
 Kwality walls
4. Campbell
5. Bakin Robbins
6. Haagen-Dazs
7. Vadilal
8. Dinshaw’s
9. Havmor
10. Hangyo
11
Chapter – 3
Company Profile
12
HISTORY OF HANGYO ICE CREAMS PVT LTD:
HISTORY:
Hangyo Ice Creams Pvt. Ltd. is the main company of the Srikrishna Group, a
100crore conglomerate with holdings in milk and dairy products, ice creams and fresh
foods, restaurants, and accommodation. Hangyo Ice Cream Pvt, Ltd, Karnataka's first
private ice cream factory in the organised sector, shares the same pioneering legacy as
Srikrishna Group. Hangyo is a leading ice cream brand appreciated by people from all
walks of life in its fast-developing market, which includes the states of Karnataka, Kerala,
and Goa
Hangyo Ice Cream comes in a range of packaging options, including cups, cones, and
candies. There are currently 138 different ice cream flavours available in this novelty, as
well as larger take-home family packs
Hangyo Ice Creams are now sold along the coast of Karnataka, from Mangalore to
Karwar, as well as in important cities such as Bangalore, Mysore, Bagalkot, and Bijapur.
Athani, Navalagond, Naragund, Ranebennur, and Gadag are among the small towns
covered.
ABOUT THE HANGYO ICE CREAMS PVT LTD:
Hangyo Ice Cream Pvt ltd. Incorporated in 2002 it is Karnataka’s first Pvt Ice
cream manufacture. Hangyo Ice Creams Pvt Ltd. an ISO 22000:2005 certified company.
They are manufacturing 138 varieties of ice creams. Hangyo is imported and successfully
commissioned extruder plant from Germany .There are totally 2 plants in Karnataka.
They use unique & solid retailing system like Hangyo parlour and Hangyo
shoppers as their retail chain. It entre in the market as a local player in Karnataka now a
days it marketed their product in other states of the India but it has to create their market at
international level.
13
INFRASTRUCTURE:
The Company's first full-fledged production plant, located in Heroor village in

the Udupi District, was created in 2003 with 100% indigenous material.
The plant has a daily ice cream production capacity of 20,000 litters. This plant
produces all of the company's ice cream goods in various forms such as cones, candies,
sundaes, and cream cups.
ISO CERTIFICATION:
Hangyo Ice Cream Pvt. Ltd. is ISO22000:2005 accredited in both its Dairy
and Ice Cream divisions. Hangyo is likely the state's first ISO-certified ice cream
manufacturer in the commercial sector..
MARKET:
Hangyo ice cream is available in a number of forms, including cups, cones,

and candies. There are currently 138 different ice cream flavours available in this novelty,
as well as larger take-home family packs. Hangyo ice creams are now sold from
Mangalore to Karwar, as well as other major towns like as Bangalore, Mysore, Hubli-
Dharwar, Belgaum, Haveri, Gulbarga, Bagalkot, and Vijapur. Hangyo ice creams have
already opened in Solhapur and Kolhapur in Maharashtra, as well as minor towns like
Athani, Navalagond, Naragund, Ranebennur, and Gadag.
14
RETAILING:
Hangyo ice creams has established a unique retail concept that has allowed
the brand to remain consistent in its success. For the vending of ice cream and milk
products, this format relies on a chain of franchisees known as "Hangyo parlours" and
"Hangyo Shoppes."
Hangyo Ice Creams Pvt. Ltd. has a network of around 6000 dealers in its
present business region. For ice cream display and sales in major cities, Hangyo ice creams
has crucial agreements with larger retailing behemoths including Big Bazaar, Metro, More,
and Reliance Fresh..
HANGYO STRATEGY:
Hangyo Ice Creams is a good example. Hangyo sales would also benefit
from the concentration in Tier-2 cities. Existing markets would be bolstered by new ice
cream innovations, which would entice a younger age to ice cream eating.
NEW MARKETS:
Hangyo, which began as a regional company focused on the Karnataka market, is now
prepared for expansion by expanding into other states.
The organization's current infrastructure, as well as the anticipated additions,

will allow it to enter the Maharashtra and Andhra Pradesh markets. By sharing smiles,
Hangyo is certain to gain good Brand Equity in new areas. The variety of novelties
produced in this plant will definitely please the most important ice cream consumers –
children and teenagers.
HANGYO AND SOCIETY:

Hangyo is a responsible corporate citizen, currently assisting over 3500 households
directly and indirectly. Our contributions to society would directly and indirectly benefit
over 5000 families with this new factory...
15
Hangyo Ice Cream holds an annual interschool cricket tournament in

Mangalore, with scholarships offered to the winning team and kids who thrive
academically in their 10th grade. In Mangalore, this has become a highly popular
attraction.
NEW PLANT:
The new plant is established at village Hosalli, Kirwatti in the year 2011. The plant has
capacity of produce 30000 litters/day of ice cream with the help of imported automatic
plant.
+-
The present base a new expansion helps the organization to connect with business sector of
Pune. It has a good transportation and area for expand of the infrastructure of the company.
And it’s also in such a place that where this plant is enjoying all the facilities like a
drainage system, transportation and availability of raw material like a milk because
shreekrishna dairy is located in front of this plant
And it’s located in beside NH 63 it’s beneficial that good transportation is X factor and it’s
also provided a security for plant
16
VISION AND MISSION STATEMENT
Vision:
To increase the quality and quantity of our products and services by promoting healthy
practises through cost-effective operations, with the goal of serving ultimate clients to their
maximum satisfaction at a reasonable price through group assistance optimization.
Mission:
To make Hangyo as a national brand in coming years.
OBJECTIVE OF THE ORGANIZATION
 Delivery of the product in time.

 Reducing inventory caring cost.
 To increase the number of the industry in the district and expand the business out
of the Karnataka.
 Increase the demand of the product.
 Using new technology in quality control to increase the productivity and sale.
QUALITY POLICY:
 Using quality and safety policy in the all stage of the company processing like
production, packing and supplying of ice creams to customer satisfaction.
 Evolving and practicing integrated and interactive total quality management.
 Quality improvement as continues processing and improve the quality management
system continually to ensure and enhance satisfaction.
17
HANGYO LOGO
AWARDS:
 Pradeep Pai Managing Director “Udyog Bharati” for his excellence and leadership.
In 2003 Pradeep Pai Managing Director,Hangyo Ice creams Pvt. Ltd received Udyog
Bharati award form Indian Achiever Forum.
 SME excellence award.
In the year 2017 Hangyo got the SME excellence award in relevance with the
growth customer acquisition in food and agro product sector from Karnataka small
&medium business owner association (KSMBOA)
 Hangyo won Spandana business award for fast growing business.
 Hangyo won award for 50 fast growing brands in India.
18
ORGANISATION STRUCTURE:
BOARD OF DIRECTOR
Executive chairman Dinesh R.Pai

Managing director Pradeep. G. Pai
Executive director Jagadish Pai
Nominee director Varun sood
Nominee director Rohan ajila
Corporate Advisor:
Shrikrishna Corporate Services Private Limited, Hubli
Auditor:
M/s M.Rajesh kini & Co
Principle bankers:
AXIS Bank Ltd, Mangalore
Registrar office:
#301/302 streling chamber, Kalakunj road,Kodialbail, Mangolre -575003

.
Factory:
Unit 1:
Survey no. 62/3D, 52, heroor village, Brahmavar Udupi district,

Karnataka
Unit 2:
Hosalli village, Kiravatti (TQ) Yellapur,(D) Karwar-581359
19
Organisation Structure
Chairman (Dinesh pai)
Vice President (Nitin Kulkarni)
Deputy Assistant General

Production Maintenance General
Manager General Manager
Manager Manager Manager (F&A)
(QC) Manager Purchase
(P&A)
Assistant Maintenance Manager

Shift IN Manager
Manager Executive (Store & Manager (F&A)
Charge (P&A)
Production Purchase)
Shift IN Assistant
Executive QA Executive DY Manager Manager Executive (F&A)
charge
(Store &
Purchase)
Shift IN charge
Electric Micro
Executive S R Executive (Store &
Technician Biologist
Purchase)
Executive Store
Supervisor Lab Assistant
Executive
Supervisor
Clerk Receptionist
Office Boy Supervisor
20
DEPARTMENT STUDY:
Hangyo Ice Cream Pvt. Ltd. is a well-established and having distinguished departments
with responsibilities that drives company towards profitable organization.
1) Human resource department

2) Stores department
3) Production department
4) Quality control department
5) Accounts departments
6) Dispatch department
7) Maintenance department
8) Marketing department
HUMAN RESOURCE DEPARTMENT (HRD):
Mr. Ranjan L is a Head of this department. He will take care of recruiting, selection of
employees, etc…
Number of employees in administration is 10.
STRUCTURE OF DEPARTMENT:
H R Manager
Assistant Manager
Executive
21
ROLE AND RESPONSIBILITIES ON HUMAN RESOURCE

DEPARTMENT:
 Employees selection as per requirement

 To take care of the employers
 Fixing salary, wages to the employees
 Provide training to the employees
 Build a good relation between employees and management
STORES DEPARTMENT:
The store department is the place where all the materials are required by the
industry are kept. The material from the major part of the total cost and constitutes one of
the most important assets of the company. Stores department manages the stores of the raw
materials and its maintenance throughout the year. It helps in efficient management of
overall inventory saving cost and time.
Hangyo ice cream private ltd has well maintained stores and inventory house and
all the principal of stores are followed to maintain the material according to the nature of
use and nature of material for production and miscellaneous usage.
STORES DOCUMENTS:
 Store ledger
 Packaging materials record
 Raw material record
 Bills of suppliers
 Flavour record
 Inventory record
22
DEPARTMENTAL STRUCTURE:
Store (executive)
Store supervisor
Store assistant
Employees
ROLE & RESPONSIBILITY OF STORE DEPARTMENT
 To maintain the raw material produced

 To maintain the packaging material
 Stamping the cartons as per product requirement
 Stamping the lids for ice creams as on date
 Price specification on lids
 Maintain the records of raw and packing material.
 Intimate purchase department for ordering per record per record level.
 Maintain stock by applying a FIFO Method
RAW MATERIAL MAINTAINED
a) Flavours
b) Skimmed milk powder
c) Stabilizers: low fat stabilizer, median fat stabilizer
d) Liquid glucose
e) Fruits And Commodities
23
STORE PROCEDURE:
1. Receive material from purchase department as per ordered

2. Record in the raw material and package material ledger
3. Store inventory in the stores
4. Receive the issue slip from the production department as per the production planning
5. Punching of the MRPs, sampling on the lids, cartons for packing the final material.
PRODUCTION DEPARTMENT:
Conversion of raw materials to finished products through semi-finished product, this

process is called as production.
Hangyo ice cream Pvt. ltd. Is a well-known company producing ice cream competing with
the known brands like walls, Aditya ice creams and pricing the vigorous competition, it
made own identity, Brand name is been identified variety of ice cream are in cup, cones
and candies, the 34 varieties of ice creams are being served in these novelties and also in
take homes big packs and his production capacity of 16Kl per day.
Mr Deshmukh is a head of the production and quality control departments, and number of
employees in production in 66.
The production unit has a product type of layout which means layout of machinery and the
shortage is done as per the product requirement.
Production is very important in easy industry without it is in department unit move in

production process department we have.
The production unit has a product type of layout which means layout of machinery and the
shortage is done as per the product requirement. Production is very important in every
industry without is in department unit move in production process we have production unit
layout.
24
Machinery:
1. Pre-production mix
a) 2000 litters. Capacity tanks
b) Homogenizer
c) Venture pumps
d) Chillers filters
e) Pasteurizers.
f) Butter melting chamber
2. Cold room
a) Evaporator
3. Filling and packaging
a) Continuous freezers
b) Cups and cones filling machines
c) Lolly tanks
d) Hardening tunnels
e) Weighing machines
P. manager
Executive
Technical officer
Officers
Operators
Employees
25
ROLE AND RESPONSIBILITY OF PRODUCTION DEPARTMENT:
 Received request from the Marketing department

 As per request the ice creams will produce
 Preparation of the good quality ice creams
 Send the production report to the Quality department
 Send letter to the stores department for the taking of Row materials for the
productions.
 Finished production sent to the stores.
ADDITIVE TO THE MILK:
a) Skimmed milk powder

b) Sugar
c) Stabilizer
1) Liquid Stabilizer
2) Stabilizer for low fat ice cream
d) Liquid Glucose
e) Water
f) Cream
The ratio additives are designed by the quality control as per the fat content of
the milk on a particular date
The flow of operation in per production is:
a) Input of the milk in to the input vessel
b) Pumping of the milk in to the 2000 its vessel through pump
c) Addition of water, SMPs, sugar, stabilizer, liquid glucose accordingly
d) Mix the solution well and heat till the solution gets saturated solution.
e) Pump the solution to the homogenizer to make solution homogenous in nature
f) Pass through the pipeline to the low freezer and to vessel in the filling and packaging
area.
NOTE: This vessel minimum capacity is 1000litar maximum is 2000litar

And the tank is kept empty and dried for the next batch to start and this is a branch to
production as per the requirement of the low fat and the medium fat.
26
FLOW DIAGRAM
Raw milk
Ingredients (sugar,
stabilizer, glucose)
Mix Preparation
Flowering tub
Colours addition
Depressing
Machine cups placing
Lid
Packing
27
3 QUALITY CONTROL DEPARTMENT:
It is very important department in Hangyo Ice Cream. It is inspection the different

departmental works, like checking of raw material till dispatch of finished goods.
Quality control manager
Microbiologist
Employees
ROLE AND RESPONSIBILITIES OF QUALITY CONTROL

DEPARTMENT:
 Inspection of bill which is given from stores department

 To issue raw material to the production department
 To chick the weight of the ice creams.
 To chick the overall operation of the organization.
3.7.4 MAINTENANCE DEPARTMENT:
Maintenance offices head the maintenance department. The work of this department is to
maintain all the requirement and machineries in the factory. This department is also called
workshop which place a very important role in the organization.
Hangyo ice creams private Ltd, has a full-fledged and well established maintenance
department Mr Ramamurthy is the Sr.Manager. The number of employees in maintenance
of quality control, stores, dispatch etc…
28
Maintenance department has been divided into three major workshops .
1. Maintenance room
2. Power house
3. Boiler room
1), Maintenance room consist of:

a. Compressors
b. Ammonia
2). Power house consist of:

a. Generators
b. Fire extinguishers
c. Diesel tank
d. Panel board
3). Boiler room:
To maintain boiler for the hot water for the supply of hot water to the production
Maintenance plays major role in maintaining the machinery smooth running, cold room,
temperature maintained by evaporator’s hardener
PROCEDURE:
1. Temperature to be checked: cold room, milk room, written in log book

2. To checked smooth running of the tanks.
3. Check the condenser water level
4. After production defrosting of the cold room hardening.
29
Manager
Refrigeration technician
Electrical
Technician
Employees
ROLE AND RESPONSIBILITY ON MAINTENANCE

DEPARTMENTS:
 Temperature to be checked cold room, written in log book.

 Temperature should be maintained between 20o to 250
 Check the condenser water level
 After production defrosting of the cold room hardening done.
 Compressor reading (suction, discharge, oil pressure, Amperes)
 They should be maintain a machinery in such a way that that will never trouble
shoot while production
30
MARKETING DEPARTMENT:
Marketing has been defined in varies ways. The definition that serves our
purpose best is as following:
Marketing is a social and management process in which an individual or a group obtains

what they require and desire by creating, marketing, and exchanging value-added products
with others. Marketing is the process of identifying and converting consumer needs and
desires into product and service specifications, so building demand for these things and
then gradually expanding it.
Marketing attempts to recognize the need and develop products for meeting the need and
wants of customers. The consumer satisfaction is the goal of every marketing activity. The
consumer and his satisfaction is prominent all marketing decision of successful firms.
Marketing management is a process of planning, implementing and control of any group
activity for attaining desire objectives simply put marketing is the application of these
managerial processed to the marketing function of an enterprise.
MARKETING OBJECTIVES:
 To increase the market share of Hangyo by increasing the sale of Ice cream of
Hangyo.
 To be responsive to consumer source to be competitive in market.
 To streamline the marketing operation.
 Initiates efforts to expand its branded Hangyo Ice cream product and would
emerge in national player very soon.
MARKETING OFFICE
The plant was established in 2012 at Kirwatti with some established objectives. Three
broad objectives are laid down which cover almost all core areas are….
1. To have control over the sales network and centralizing the activities.
2. To develop better business relationship with both agent / dealer and consumers.
31
3. To improve core service or basic service or value-added service. If the above

objectives are analysed clearly, it clear that the marketing activities are looked to be
separate and stressed more. All objectives cover areas like sale
ROLE AND RESPONSIBILITIES ON MARKETING DEPARTMENT:
 Give a good advertisement and create demand for the products.

 Maintain on time delivery of products.
 Spread the operation in the different, new cities.
 As per consumer demand the marketing department sent receipt to the
production department for production.
 To meet the consumer needs and demand to provide good quality products.
DISPATCH DEPARTMENT
Company final product
Hubs
Distributor
Retailer
Consumer
32
After packing of the product is ready than packing report is sent to the dispatch officer
than dispatch head verified by the central excise office will plan every day creation report.
 There are 4 hubs in Hyderabad, Bangalore, Panjim, Sollapur

 Before loading minimum temperature-14 c
 After loading minimum temperature should be not less than – 18
 Daily they transfer 25000 units (season) 8000 units (no season) to hubs.
 Checking the staking amount.
 Checking the staking amount.
 Keeping dispatch report .
Role and Responsibilities of the Dispatch Department:
 This department will take the order from various customers and
supply the particular product.
 Receipt of dispatch of material is submitted to the account
department.
 Maintain a finished goods stock record
 Taking a responsibility of loading and delivering finished goods at
right time
33
FINANCE DEPARTMENT:-
Finance department is an important department in an organization. Finance department

maintain many books of accounts mainly journal book, profit and loss account, Balance
sheet. Whenever amount is paid to any department that also record in the book of account.
In addition, taxation cash loan normal and statutory payments expenses, corporate
requirement, audit requirement, this section handles advances and other operations relating
to banks. It is responsible for maintaining up to date account.
They spend more amount to purchasing the raw milk, butter cream etc. Finance and
accounting section in Hangyo ice cream Pvt Ltd. Is just like ministry of finance as it’s
preparing budget every year and financial roles for receipts 7 payments are framed and
also it maintains all accounts. At the end of the year financial statement are prepared by
Mr. Raghavendra Pai.
FUNCTIONS:
 Maintain purchase and selling accounts.

 To maintain monthly process accounts.
 Maintaining day to day transactions
 Preparing P&L account, balance sheet
 Reviewing the audit record
 Reconciliation of bank account.
 To maintain and record administration expenses
 All miscellaneous payment
 Loans and advances
 Travel expenses
 To avoid leakage of funds in the organization.
 To avoid blockage of funds
34
CAPITAL STRUCTURE:
Capital has been raised by 3 steps
1. Shares
2. Deposit from members
3. Loans and advances
ROLE AND RESPONSIBILITIES ON ACCOUNT DEPARTMENT:
 To preparation of financial statement and Balance every year.

 To evaluate the financial position of the organization
 Paying tax sincerely to government
 Recognise the available resource of the firm
 Provide finance to other department
 To evaluate the bills which was give other department
 To pay the amount for purchase of Raw materials
35
SWOT ANALYSIS
The following are Hangyo Ice Cream's SWOT Analysis
Strengths
1. A good product assortment includes a variety of flavours, party packs,

sticks, and cones, among other things.
2. Quality and packaging, as well as good marketing, are essential.
3. One of the most well-known and well-liked brands is Hangyo.
4. Ice creams with probiotics and sugar-free options were also presented.
5. Has approximately 200 goods available in India.
Weaknesses
1. Due to rising competition from international and other brands, the

company's market share has shrunk.
2. There is a dearth of international presence in comparison to well-known
global brands.
Opportunities
1. High-end ice cream aimed at persons with a higher income level.

2. Form alliances with fast-food chains and eateries
3. Vans that move around for improved visibility
Threats
1. Kulfi on the market in remote areas

2. Sweet foods and ice cream from the area
3. People who are health-conscious avoid sweets
36
CHAPTER 4
THEORTICAL BAC KGROUND
AND
LITERATURE REVIEW
37
THEORTICAL BAC KGROUND OF THE TOPIC

COST, VOLUME AND PROFIT ANALYSIS
THEOROTICAL BASE OF THE STUDY
INTRODUCTION TO COST,VOLUME AND PROFIT

ANALYSIS:
Success of every business is depended upon the profit of the business; the strength of the
firm depends on the profit earning capacity of the firm. The profit is depending on the
volume of sale, the volume of sale is depending on the volume of production how much is
the company going to produce during the requirement of the product. But the profit and
volume is mainly depends on the cost of production, cost of production means mainly a
cost of raw materials,
The above introduction says that cost volume and profit is inter related with each
other if cost of production increases than it directly affected to the volume of production if
volume of production decreases or cost of production increases it will directly be going to
affect the profit of the company cost increases profit going to decries
Two types of cost is going to affect the profitability of the business that is fixed
cost and variable cost, fixed cost will remain same during the production period if firm
produce or not to produce any think during that year fixed cost will incur during that year,
firm cannot control that cost, because this cost will incur because of the fixed asset in the
firm that is depreciation on building, depreciation on machinery etc...
Variable cost is the cost which is incur during the production it is the cost which
company has to pay to produce a single unit of product company can control this cost by
making the decision on the cost control because the variable costs are controllable cost
This company can make this decision-making process successful by applying the
cost volume profit analysis. This analysis is going to help the management in decision
making. By applying this method of analysis company will know how to control the cost
for making the increasing in the profit, and this analysis is going to help the company to
38
find out the break-even point of sale to the company. When company reach the break-even
point the stage company will receive the zero profit that means at this stage company can
cover the all its cost which company is spent during the production
Cost volume and profit analysis is used for:
1) In order to make business decisions about cost and profit,

2) Determine the point at which the company's sale will break even.
The costs of a firm were divided into two categories: fixed costs and variable costs,
which were expressed mathematically as follows:
TC = VC + FC
TC - total costs
V - Variable cost rate
F – fixed cost
Revenue defined as:
R = SP * Q
R = Revenue
SP – Selling Price
Q – Quantity sold
Income defined as:
I=R-E
R - Revenue
E - Expense
I – income
Profit defined as :
P = I – TC
I – Income
TC – Total Cost
39
Cost-volume-profit Analysis for a Single Product Business

For every business its necessary to find out how many units have to sold to achieve the
income. Every business is having a aim that making a income from the manufacturing
activity. That income is going to calculate by above equitation. Company is going to
analysis its profit by using cost volume profit analysis technique
Target Revenue = fixed cost + desired profit

Contribution per unit
This above Equation used to determine the quantity of sales required to attain
any desired level of revenue for the business, it will help the management to find out the
how much is quantity is required to achieve the level where company will capable to meet
its all expenses and make a profit above its all expenses
The Contribution Concept

The cost-volume-profit analysis is requiring to understanding the concept of contribution
margin. Cost volume profit analysis is based on contribution margin, contribution is excess
of sale price of a unit of output over its variable cost. It is excess amount over the variable
cost, contribution includes the fixed cost and profit
The fixed expenses would reflect a loss at the commencement of the operation. If
sales are zero at that point, the loss is equal to the firm's total fixed expenses. The loss will
be reduced by the contribution margin of each unit sold as the product is sold. There will
be no profit until the overall contribution equals the whole fixed expenses. After the break-
even point, each unit sold adds the contribution margin per unit of product to net income.
Total Contribution Margin

Total contribution margin is defined as total revenues minus total variable costs. Total
contribution margin is equal to P (Q) - V in terms of the profit equation for a single
product business (Q). It's critical to realise that "contribution" refers to a payment made
initially to fixed expenses. As previously stated, a business cannot make a profit until total
contribution equals total fixed expenses. When this happens, the company has reached
40
break-even. The quantity of sales that permits total contribution margin to equal total fixed
expenses is known as the break-even point.
Calculation of the contribution:

Contribution in volume = Sales – Variable cost
Contribution in volume = Selling price – Variable cost
Basic Assumptions of Cost-volume-profit Analysis:

Profit planning and decision-making are aided by cost-volume-profit analysis. However,
efficient application of cost-volume-profit analysis for business planning purposes
necessitates some basic understandings and assumptions, as detailed below.:
Cost-volume-profit analysis is on some assumptions as follows:

1. Cost volume and profit analysis is having a assumption that only cost of production
will affect the change in profit but in the real world profit will also affected by the
other factors like a computation, demand etc...
2. In cost volume profit analysis, it is assuming that price of the product will constant but
in real world price will change according to the change in demand for the product in
the market
3. The break – even sale only according to the total cost break even sale will not include
other income of the firm
Cost-Volume-Profit Analysis: Is A Decision-making Tool
Cost,volume and profit analysis helps the management to findout the relationship of the
cost and volume towards the output or profit Cost,volume & profit analysis will answer the
all such question about future changes of revenue,cost,production levels and profit.this
analysis also give the solution of such question if company wants to rise it’s profit in such
situation this analysis gives a solution that how much cost will be requir to rise that much
of profit, it is a dicision making tool which gives the ans for how much sale v olume is
required to achive a desired level of profit because this analysis is distingush between
fixed cost and variable cost to achive the profit.
Componey can take a dicision on its profit making capicity using cost volume profit
analysis because this analysis provides all such data which will help us the managent while
41
making the dicision. It states that if componey going to incrise the profit than how much
should componey going to produce at what cost of production this question will answer by
this analysis
Advantages And Dis-advantage of cost volume profit analysis:
Advantages:
1) It assists the manager in making decisions by determining a break-even point,

targeted profit, and so on.
2) Assists in marketing activities to achieve a sales goal
3) Assists with budgeting
Dis-advantages:
1) This analysis will just look at costs from manufacturing through distribution, but
other costs will be included as well.
2) All costs cannot be categorised as fixed or verifiable because there are semi-verifiable
and semi-fixed costs, such as power charges, where the price remains constant to
some extent, i.e. the minimum consumption fee.
3) Total cost alone will not effect total revenue; other elements like as raw materials,
demand, and price reductions all have an impact on cost. The entire revenue of the
company is affected by cost changes.
Meanings:
Cost, Volume and Profit Analysis
A cost accounting method called cost, volume, and profit analysis shows how cost and
volume affect profit. Cost-volume profit analysis can be used to identify the breakeven
point for different sales volumes and cost structures, which can be useful for managers
making short-term economic decisions.
42
COST:
Cost is nothing more than the amount required to generate a unit of output, as well as all
other expenses incurred when creating finished items, which may be constant or variable.
Volume:
Volume is the maximum output that a company can achieve by effectively and efficiently
utilising its available resources. It is also the highest capacity that a company can achieve
by utilising its available resources. For example, it is the sum of all expenditures incurred
by the product till the final product is obtained.
Profit:
Profit is the excess amount above the overall cost; profit is nothing more than a surplus
amount after all of the firm's costs have been covered. It is the investors' return on their
investment.
Fixed cost:
A fixed cost is an expense or cost that remains constant regardless of the volume of
products or services produced or sold. Fixed costs are expenses that must be paid by a
corporation. It's one of two components of a company's total cost of operations, with
variable costs being the other. Fixed costs constitute a net loss for the company if the
company does not make any sales.
Cost
Fixed cost
Volume
43
Variable cost:
Variable costs are production costs that vary according to the quantity of items produced.
In other words, variable costs rise by the same amount for each good produced.
Cost
Fixed cost
Volume
Break Even Point:
The break-even point is the output level at which total revenues equal total expenses. In
other words, the break-even point is the point at which a company earns the same amount of
money as it spends during the course of a production process or accounting period.
Cost Volume & Profit Analysis
TR
BEP
Cost
Fixed cost
Volume
44
Contribution:
The contribution margin shows how much of a company's revenue should go toward
covering fixed costs. To put it another way, contribution margin is revenue minus variable
expenses.
Revenue:
The whole amount earned by the company from the production activity is referred to as
revenue. It is the amount earned by the company from the sale of products created over the
course of a year or a specific period of time, and it includes other income and finished
goods. It is a portion of the total output for the year.
RESEARCH METHODOLOGY:
Secondary data:
Profit and loss account, balance sheet of the Hangyo ice creams PVT. Ltd, company
information collected through Internet, through the knawels, taking a suggestion from a
guide, graphs, and charts using Ms-excel. The study is mainly concentrated on Profit
analysis of the company so the period covered is for a 5 year of a profit and loss account to
analysis the performance of the company
45
Formulas used for calculations:
1) Formula for calculating variable cost in units:

variable cost in units: Total variable cost
Net unit sold
2) Formula for calculating Contribution of sale volume:

Contribution in sale volume = Sales – variable cost
3) Formula for calculating Contribution of sale volume:

Contribution in sale units = Selling price per unit – variable cost per units
4) Formula for calculating profit volume ratio of sale volume:

P.V.R = contribution
sale
5) Formula for calculating profit volume ratio of unit sold:

P.V.R = contribution per unit
Selling price per unit
6) Formula for calculating Break-Even point of sale units:

B E P sale = Fixed cost
Profit volume ratio
7) Formula for calculating Break-Even point of sale units:

B E P Units = Fixed cost
46
8) Formula for calculating Target income =

Target income = Fixed cost + Desired profit
Selling price
9) Formula for calculating Target volume = Fixed cost + Desired profit

10) Formula for calculating Margin of safety of sale volume:

Margin of safety of sale = Sales – BEP
11) Formula for calculating Margin of safety in units:

Margin of safety in units = unit sold – BEP in units
12) Formula for calculating Profit =

Profit = Contribution - Fixed cost
47
LITERATURE REVIEW
The principle that underpins the operation of cost-volume-profit analysis is that "at the
lowest level of activity, cost exceeds income, but as activity increases, income rises faster
than cost, and eventually the two amounts are equal, after which income exceeds cost until
diminishing returns bring cost back above income." This principle describes curvilinear
cost-volume-profit analysis. Cost and revenue curves that appear to be theoretically solid
are not practical. The accountant discovered the necessity to incorporate additional
information about cost behaviour and sales policy in order to ensure that a workable model
could be developed based on these principles.
The followings are the underlying assumptions of cost-volume profit analysis according to
Horngen et al (2006)
• The revenue and behaviour are both linear.
• The selling price is fixed.
• All costs can be broken down into fixed and variable components.
• The total fixed cost stays the same.
• The total variable cost of a product is proportional to its volume.
• The only cost driver is volume.
• The cost of production inputs (such as materials) is fixed.
Other places where the breakeven model can be used (C-V-P). Equipment selection, make-
or-buy decisions, advertising programmes, distribution channel choices, and plant additions
are some of the options available. These choices are the foundation of planning and
management. Breakeven analysis can help manufacturing organisations with product
planning and control, which can be facilitated and enhanced.
Activity based costing, Make or Buy Analysis, Budgets, Product costing, Varianceanalysis,
Economic Ordering Quantity (EOQ), Decision theory (decision tree), and other
management accounting decision tools can be utilised in making business decisions among
48
small businesses. The cost, volume, and profit all have a strong relationship. When volume
is raised, the cost per unit falls and the profit per unit rises. As a result, volume and profit
have a direct relationship, whereas volume and cost have an inverse relationship. For the
cost and management accountant, analysing this link has become interesting and useful.
This analysis can be used for profit forecasting, cost control, performance evaluation, and
decision-making.
According to Abdullahi (2015), Cost volume profit analysis, is an estimate of how changes
in expenses (both variable and fixed), sales volume, and pricing affect the company's profit.
Cost-volumeprofit analysis, he claims, is cost planning based on a single cost unit. Any
variation represents a measure of performance since cost-volume profit analysis purports to
be what cost should be. The difference between the cost-volume-profit analysis and actual
expenses is known as a variance, and the cost-volume-profit analysis is known as cost-
volume-profit analysis.
Kim (2015) devised a micro-approach for determining breakeven points and profit targets.
The goal of this research was to create a systematic approach for refining the answers to two
key questions in CVP analysis: break-even point and target profit.
Horngren et al. (2015) suggest that an analysis of production targets and budgets can be
used as a management tool in making decisions.
Granof, Khumawala, Calabrese, & Smith, 2016). The budget is the greatest expenditure
limit in government work units. As a result, analysis of the quantity of output and amount of
expenditures may be required in performance-based budgeting based on standard input
costs. The CVP analysis, according to Punniyamoorthy (2017), is a method for assessing the
impact of changes in value, volume, variable costs, or fixed costs on benefits. CVP was also
used to determine pricing, short-term options, target costs, and the exchange value.
Jiang and Shen (2017) conducted a cost, break-even, and safe operating level analysis of the
restaurant, as well as the influence of changes in the switch factor on restaurant profit. By
studying multi-element placement in the service industry and examining the relationship
between the major elements of the service industry and the profit due to factor change, this
result assisted the restaurant management in making better decisions. Walidi (2017).
Standard input cost is a benchmark cost that is set to provide cost component outputs in
work plans and budgets in the form of unit prices, tariffs, and indexes.
49
Lulaj and Etem Iseni (2018) argued that the CVP analysis was an important content to plan
and make decisions in business. To make this research accurate and successful, it was
conducted in manufacturing and service businesses, using a combination of econometric
models. The findings revealed that the quantity of manufactured products had a favourable
impact on service company sales and improved profitability in the manufacturing industry,
indicating that there was a strong link between production and sales.
Stoenoiu (2018) did a sensitivity analysis of the variables utilised in the CVP analysis The
study was motivated by the necessity to optimise and manage expenditures in all sectors
owing to unforeseen economic developments. As a result, this study looked at the link
between the three CVP indices to highlight the importance of ongoing monitoring and
adjustment of these factors in order to give a solid foundation for management decisions.
Due to the direct relationship and inversion between these variables, the investigation
revealed the amount and significance of changes toward one or more variables.
Enyi (2019) The weighted contribution margin (WCM) and the reversed contribution
margin ratio were examined (RCMR). Because it neglected the inverse relationship between
a product's contribution margin ratio (CMR) and its break-even point, the findings
demonstrated that WCM lacked analytical efficiency and generated poor product mix
(BEP). The usage of the RCMR with the consequences of the CMR/BEP measurement was
suggested in the paper.
50
Chapter – 5
Data Analysis and
Representation of Data
51
1) Calculations of Profit Volume Ratio, Contribution, Fixed cost, &

Break-Even point, margin of safety of the Hangyo Ice-Creams Pvt.
Ltd. for the year 31-3-2017
Total Revenue = ₹ 69,93,62,246
Total sale volume of 2020 :

Net Sale ₹ 68 65 41 510
Net unit sold 72 58 192 litters
Selling price per unit ₹ 95
Calculation of variable cost
Cost of material 46 77 23 862

Processing expenses 3 31 96 943
Transportation expenses 4 60 46 981
Labor charges 5 72 47 360
Selling expenses 5 91 84 603
Total variable cost 66 33 99 749
Calculation of Fixed cost

Finance cost 3219402
Depreciation charges 12890674
Salary 9589881
Total Fixed cost 2 56 99 957
52
1) Formula for calculating variable cost in units :

variable cost in units : Total variable cost
Net unit sold
variable cost in units = 66 33 99 749

72 58 192
variable cost in units = 91.40
2) Formula for calculating Contribution :

Contribution = Sales – Variable cost
Contribution = ₹ 68 65 41 510 - 66 33 99 749

Contribution = 02 31 41 761
3) Formula for calculating Contribution of sale volume :

Contribution in sale units = ₹ 94.58 - 91.40
Contribution in sale units = 3.18
4) Formula for calculating profit volume ratio:

P.V.R = Contribution
sale
P.V.R = ₹ 02 31 41 761
₹ 68 65 41 510
P.V.R = 0.03
53
5) Formula for calculating profit volume ratio of unit sold :

P.V.R = 3.18
94.58
P.V.R = 0.03
6) Formula for calculating Break-Even point:

BEP = Fixed cost
Profit volume ratio
BEP = ₹ 2 56 99 957
0.03
BEP = ₹ 85 66 65 233
7) Formula for calculating Break-Even point of sale units :

B E P Units = ₹ 2 56 99 957
3.18
B E P Units = 80 81 747 units
8) Formula for calculating Target income =

Target income = Fixed cost + Desired profit
Selling price
Target income = 2 56 99 957 + 0 95

3.18
Required income = ₹ 76 77 66 011
54
9) Formula for calculating Target volume = Fixed cost + Desired profit

Target volume = 2 56 99 957 + 0
3.18
Required volume = 80 81 747 units

Profit = 2 31 41 761 - ₹ 2 56 99 957
Loss = -25 58 196
Interpretation:
 Variable cost is rs 66 33 99 749 and variable cost per unit is rs 91
 Contribution is rs 2 31 41 761 and contribution per unit rs 4 rs
 Fixed cost is ₹ 2 56 99 957
 Profit volume ratio is 0.03
 ₹ 85 66 65 233 is BEP in sale volume & 80 81 747 units litters is BEP units
 Company sale is not reached BEP
 Company needs to sell 80 81 747 units to reach break- even point and revenue
should be
₹ 76 77 66 011 to reach break-even point
55

Total Revenue = ₹ 85,27,52,975

Net Sale ₹ 84 61 17 358


Salary 9708860
56

Net unit sold
variable cost in units = 787127358

846117358

Contribution = ₹ 84 61 17 358 - 78 71 27 358


Contribution in sale units = ₹ 100 - 93
Contribution in sale units = 7

sale
P.V.R = ₹ 05 89 90 000
₹ 84 61 17 358
P.V.R = 0.07
57

P.V.R = 7
100
P.V.R = 0.07

BEP = Fixed cost
Profit volume ratio
BEP = ₹ 4 27 05 525
0.07
BEP = ₹ 61 00 78 929

B E P Units = ₹ 4 27 05 525
7
8) Formula for calculating Margin of safety :
Margin of safety = Sales – BEP

Margin of safety ₹ 84 61 17 358 - ₹ 61 00 78 929
Margin of safety = ₹ 23 60 38 429
58
9) Formula for calculating Margin of safety in units :

Margin of safety in units = 84 71 548 – 61 00 789

Margin of safety in units = 0 23 70 759

Profit = 5 89 90 000 - ₹ 4 27 05 525
Profit = 1 62 84 475
Interpretation:
 Fixed cost is ₹ 4 27 05 525
 ₹ 61 00 78 929 is BEP in sale volume & 61 00 789 litters is BEP units
 Company sale is reached BEP & sale is more than BEP
59

Total Revenue = ₹ 1,06,61,97,141

Net Sale ₹ 1,05,41,54,613
Selling price per litters ₹ 114


Salary 10187844
Total Fixed cost
4 90 19 625
60

Net unit sold
variable cost in units = 99 30 07 271

92 85 447

Contribution = ₹ 1,05,41,54,613 - 99 30 07 271


Contribution in sale units = 114 – 107


sale
P.V.R = ₹ 06 11 47 342
₹ 1,05,41,54,613
P.V.R = 0.06
61

P.V.R = 7
104
P.V.R = 0.06

BEP = Fixed cost
Profit volume ratio
BEP = ₹ 4 90 19 625
0.06
BEP = ₹ 81 69 93 750

B E P Units = 4 90 19 625
7
B E P Units = 70 02 804

Margin of safety ₹ 1,05,41,54,613 - ₹ 81 69 93 750
Margin of safety = ₹ 2371 60 863
62

Margin of safety in units = 92 85 447 - 70 02 804

Margin of safety in units = 0 22 82 643

Profit = 6 11 47 342 - 4 90 19 625
Profit = 1 21 27 717
Interpretation:
 Fixed cost is ₹ 4 90 19 625
63

Total Revenue = ₹ 478358628

Net Sale ₹ 47,01,12,500


Salary 9920210
64

Net unit sold
variable cost in units : 42 37 11 555
59 31 678
variable cost in units : 71

Contribution = ₹ 47,01,12,500 - 42 37 11 555


Contribution in sale units = ₹ 8

sale
P.V.R = ₹ 4 64 00 945
₹ 47,01,12,500
P.V.R = 0.10
65

P.V.R = Contribution per unit
P.V.R = 8
79
P.V.R = 0.10

BEP = Fixed cost
Profit volume ratio
BEP = ₹ 3 79 11 144
0.10
BEP = ₹ 37 91 11 440

B E P Units = ₹ 3 79 11 144
8

Margin of safety = ₹ 47,01,12,500 - ₹ 37 91 11 440

66

Margin of safety in units = unit sold – BEP in unit
Margin of safety in units = 59 31 678 - 47 38 893 unit
Margin of safety in units = 11 92 785 units

Profit = 4 64 00 945 - 3 79 11 144
Profit = ₹ 84 89 801
Interpretation:
 Fixed cost is ₹ 3 79 11 144
67

Total Revenue = ₹ 58 29 48 894

Net Sale ₹ 56 86 95 091


Salary 9096660
68

Net unit sold
variable cost in units : 53 62 43 291
66 42 158
variable cost in units : 81

Contribution = ₹ 56 86 95 091- 53 62 43 291



sale
P.V.R = ₹ 03 24 51 800
₹ 56 86 95 091
P.V.R = 0.06
69

P.V.R = 5
86
P.V.R = 0.06

BEP = Fixed cost
Profit volume ratio
BEP = ₹ 3 31 71 087
0.06
BEP = ₹ 55 28 51 450

B E P Units = ₹ 3 31 71 087
5
B E P Units = 66 34 217

Margin of safety = ₹ 56 86 95 091 - ₹ 55 28 51 450
70

Margin of safety in units = 66 42 158 - 66 34 217

Margin of safety in units = 7941 units

Profit = 3 24 51 800 - ₹ 3 31 71 087

Profit = 7 19 287
Interpretation:

 Fixed cost is ₹ 3 31 71 087
71
Changes in Revenue, sale, BEP from the year 2020-2019
Interpretation:
 Revenue for the year 2017 it is ₹ 69936246, 2018 it is ₹ 852752975, 2019 it is

₹ 1066197141, 2020 it is ₹ 478358628 , 2021 it is ₹ 582948894.
 Sales for the year 2017 it is ₹ 686241510, 2018 it is ₹ 846117358, 2019 it is ₹
1054154613 2020 it is ₹ 470112500, 2021 it is ₹ 568695091.
 BEP for the 2017 it is ₹ 856665233, 2018 it is ₹ 610078929, 2019 it is ₹
816993750 year 2020 it is ₹ 379111440, 2021 it is ₹ 552851450
72
Changes in Profit from the year 2020-2019
Interpretation:
 In the year 2017 company made a profit of ₹ -25 58 196

 In the year 2018 company made a profit of ₹ 16284475
73
Chapter – 6
Findings and Suggestion
Conclusions
74
Findings:
 The company sale is increasing year by year as par my observation the

company made a sale of, 72,58,192, lac. Litters during the year 2017,
84,71,548, lac. Litters during the year 2018, and 92,58,447 lac. Litters, in the
year 2019 , 59,31,678, lac. Litter in the year 2020, 66,42,158 lac litters during
the year 2021,
 The revenue of the firm is also increasing year by year, in the year 2017 ₹
68,62,41,510, year 2018 ₹ 85,27,52,975, year 2019 ₹ 106,61,97,141, 2020 ₹
47,83,58,628, 2021 ₹ 58,29,48,894,
 Variable Cost of production is changes according to the changes in output that
is :
 Material cost 2017 5%, 2018 6%, 2019 is 5%, 2020 it is 6%, 2021 –
5%,
 Processing cost 2017 5%, 2018 6%, 2019 is 5%,2020 is 6%, 2021 5%,
 Transportation cost of 2017 7%, 2018 7%, 2019 is 6%,,2020 is 7%,
2021 7%,
 Workers cost of 2017 9%, 2018 10%, 2019 is 10% , 2020 is 5%, 2021
7%,
 Selling expenses of 2017 7%, 2018 8%, 2019 is 10%,,2020 is 4%,
2021 5%,
 Variable cost per unit of production is going to increases every year that is in
2017 - 91rs, 2018- 93rs, 2019- 107rs, 2020- 71rs, 2021 -81rs,
 Fixed cost of production in total fixed cost change as follows
 Finance cost of 2017 20%, 2018 24%, 2019 is 23%, 2020 is 47%,
2021 25%,
 Deprecation of 2017 80%, 2018 76%, 2019 is 76%,2020 is 53%, 2021
75%,
 Every year company is able to achieve the profit because company revenue is
more than the break-even point except during the year 2017.
 Company has a problem with its profits because company is inconsistent in its
profit makings. In the year 2017 ₹ 33,83,861, year 2018 ₹ 1,28,50,157, year
2019 ₹ 1,21,76,276. 2020 ₹ 28,40,784 Lac, year 2021 ₹ 52,84,860 Lac.
75
 In the year 2020 company made a profit 1.80%

 But in the year 2021 profit is decreased to 0.12% compare to year 2020
profit
 In the year 2017 company profit decreased to 0.37% compare to year
2021 profit
 In the year 2018 profit is increased to 1.92% as compared to year 2018
profit
 But again in the year 2019 profit decreased to 1.15% compare to year
2018 profit
Suggestion:
 If possible at the peak season company must have a plan to produced ice creams at
a night shift between 10pm to 6am because at that time Government gives a
discount in electricity charges that is 5.75 rs per unit
 Company has to take a decision on control the finished goods inventory because
closing stock increases the carrying cost
 Company should concentrate on Selling expenses because it is going to increase
year by year
 Company should take necessary action controlling labour expenses because it is
also increases year by year
 Company should plan for manufacture a cups, lids, boxes which will use for Ice-
cream production
76
Conclusions:
The study was done at HANGYO ICE – CREAMS PVT. LTD. To find out
the cost, volume and profit relationship of the company with the help of profit and loss
account of the company for five year.
After the analysis it was found that the company a uniformity in fixed cost as
long as it brings profit. Total cost of production should be reduce in order to gain a
maximum profit especially in selling expenses and labour expenses. Company should try
to reduce its selling expenses and labour expenses it will bring a maximum profit to the
company
We conclude of this analysis, company or management enables to predict the
profit on volume produced and determine the price of the products. But through this
analysis the manager can easily take a decision by showing this analysis report how cost
should utilize to increase the profit
77
Bibliography
78
Bibliography:
Text books
1) Cost accounting Principles and Practices
Author : B.M. Lall Nigham

I.C. Jain
2) Management Accounting
Author : Dr. G.B. Baligar
Websites
www.hangyo.in
79
A STUDY ON
“COST, VOLUME AND
PROFIT ANALYSIS”
AT HANGYO ICE CREAMS
PVT. LTD.
BY – RAKESH SADARE
Submissiondate:03-Jun-202212:47PM(UTC+0530)
SubmissionID:1849621270
Filename:RBS_Plagirism.docx(1.17M)
Wordcount:11670
Charactercount:56587
80
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VISVESVARAYA TECHNOLOGICAL

Jnana Sangama, Belagavi – 590018

Under the guidance of

Dr. Saleem G. Sonnekhan

Department of Management Studies

Signature of the Guide Signature of the Director Signature of the Principal

CREAM PVT LTD at village Hosalli, Kirwatti, is an original work done by

Place: Dharwad Rakesh Sadare

I would like to thank my college, SDM College of Engineering & Technology

1 Executive Summary 1-6

2 Industrial Profile 7-10

3 Company Profile 11- 35

Theortical Background And Literature

Data analysis, Interpretation and

6 Findings, Suggestions and Conclusion 73-76

1) To identify the relationship between cost, volume & profit

Scope of the study

1. This study is mainly concentrating on cost incurring from production to

 The company sale is increasing year by year as par my observation the

HISTORY OF ICE CREAMS:

ICE CREAM INDUSTRY IN INDIA

Top 10 ice-creams brands in India:

HISTORY OF HANGYO ICE CREAMS PVT LTD:

ABOUT THE HANGYO ICE CREAMS PVT LTD:

The Company's first full-fledged production plant, located in Heroor village in

Hangyo ice cream is available in a number of forms, including cups, cones,

The organization's current infrastructure, as well as the anticipated additions,

HANGYO AND SOCIETY:

Hangyo Ice Cream holds an annual interschool cricket tournament in

VISION AND MISSION STATEMENT

To make Hangyo as a national brand in coming years.

OBJECTIVE OF THE ORGANIZATION

 Delivery of the product in time.

Executive chairman Dinesh R.Pai

#301/302 streling chamber, Kalakunj road,Kodialbail, Mangolre -575003

Survey no. 62/3D, 52, heroor village, Brahmavar Udupi district,

Hosalli village, Kiravatti (TQ) Yellapur,(D) Karwar-581359

Chairman (Dinesh pai)

Vice President (Nitin Kulkarni)

Deputy Assistant General

Assistant Maintenance Manager

Office Boy Supervisor

1) Human resource department

HUMAN RESOURCE DEPARTMENT (HRD):

Number of employees in administration is 10.

ROLE AND RESPONSIBILITIES ON HUMAN RESOURCE

 Employees selection as per requirement

ROLE & RESPONSIBILITY OF STORE DEPARTMENT

 To maintain the raw material produced

RAW MATERIAL MAINTAINED

1. Receive material from purchase department as per ordered

Conversion of raw materials to finished products through semi-finished product, this

Production is very important in easy industry without it is in department unit move in

ROLE AND RESPONSIBILITY OF PRODUCTION DEPARTMENT:

 Received request from the Marketing department

ADDITIVE TO THE MILK:

a) Skimmed milk powder