You are on page 1of 3

Findings of leverages and cost sheet:

1) In this organization the operating leverage is very much higher in the first year compared
to all the periods of the study
2) It was 9.04 in the year 2006/07 which has decreased to 4.82 in the year.2007/08 and again
decreased to 4.22 in the year of 2008/09.
3) The financial leverage is slightly higher in first year compare to other years. It is 1.61 in
the year of 2006-07, 1.77 in the year of 2007/08 and 1.84 in the year of 2008/09.
4) The Administrative expenses have been increasing trend in every
year from 2007 to 2009 at the years.
5) The cost of material consumed is very high compared to previous year, in the year 2009 is
showing very high and in the year 2007 is showing low.
.

Suggestions :
The fixed cost is very much higher it constitute the major part in total cost.
The firm should maintain the its operating leverage at the current level.

Firms financial leverage is fluctuating year by year in the periods of the


study, so it should manage its fixed financial obligation at the required level,
so that it is favorably financial levered.

In the year 2009 the administrative cost is very much


should be control.

high ,so it

Conclusion
This project helps to know that the company operating in significant
manner and the sales of the company increased from year to year and considerably profit also
increased and some year the fixed cost is more so it needs to reduce its fixed cost.
The firm is favorably financial levered since it managed to keep its fixed financial obligations
at the required level but its operating risk is very high because of high fixed costs and high
operating leverage.

This study helps to ascertain the cost per unit total cost production and to know the
administrative expense. Cost sheet is the very important tool that analyses the cost of the
company. Through this cost sheet we can improve in estimated cost sheet.