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ARE WE FAMILIAR WITH THIS?

NOBODY CAN ESCAPE.

WHAT IS HAPPENING WITH US IN THIS CASE?

If you are
clever than
teachers

WHERE ARE YOU GOING?SIT DOWN

If you are
not...

GO LATE IN THE CLASS AND?

Have to
find out
a solution
from this..

AN EASY SOLUTION

ROADSTAR BICYCLE CO. LTD.


GO AHEAD WITH A ECO-FRIENDLY VEHICLE

ROADSTAR BICYCLE COMPANY LTD.


312/a, Panthapath, Dhaka.

BOARD

OF

DIRECTORS

AREA OF OPERATION
Dhaka
Chittagong
Rajshahi
Brisal
Khulna
Rangpur
Sylhet
Maymensingh

PRODUCT RANGE

Kids
Bicycle

Men
Bicycle

Women
Bicycle

Cycling
helmet

Navigatio
n device

KIDS BICYCLE
Features:
Easily handling
Smooth running
Strong
supportive wheel
Comfortable

MEN BICYCLE
Features:
Strong body
Easy moving
Hydraulic
break
Front & back
light
Gear system

BICYCLE FOR GIRLS


Features :
Easy ride
Light
Gear
Comfortable

CYCLING HELMET
Why our helmet?
Safer
Easy portable
Strongest
Well vantilated

NAVIGATOR
Features :
Navigation
service
Speed meter
Solar charger
Antiharrasement key
GPS facility

LATEST MANAGEMENT ACCOUNTING TOOLS


Just in time(JIT) system

PULL SCHEDULING

TOTAL QUALITY MANAGEMENT

LIST OF DIFFERENT COST


Particulars

Variable
cost

Fixed cost

Product
cost

Direct materials:

8,000,000

8,000,000

Direct labor

5,000,000

5,000,000

Manufacturing overhead

3,000,000

3,000,000

Period
cost

Administrative cost

700,000

700,000

Selling cost

300,000

300,000

Advertising cost

500,000

500,000

Sells commission

500,000

500,000

Depreciation

500,000

Insurance cost

500,000

500,000

500,000

Cost per unit

TOTAL FIXED COST

fixed cost

2.5m

3000
Number of unit

VARIABLE COST PER UNIT

Cost

variable cost

5833

0
1

Unit

JOB ORDER COSTING


Predetermined overhead rate
= Estimated total manufacturing overhead cost
Estimated total amount of allocation base
= 3,000,000/ 40,000 Direct labor hour
= Tk.75
Overhead Applied to the job
= (POHR*Actual direct labor hour)
= 75* 12.5
= Tk.937.5

JOB ORDER COSTING

ROADSTAR BICYCLE CO. LTD.S


SCHEDULE FOR COST OF GOODS SOLD
Particulars

Amount(tk.)

Beginning Inventory

1,000,000

(+) Raw material Purchase

7,000,000

Raw material available for production

8,000,000

(-)Ending raw material inventory

1,300,000

Raw material used in production

6,700,000

(+)Direct labor

5,000,000

(+)Manufacturing Overhead

3,000,000

Total Manufacturing cost

Amount(tk.)

8,000,000
14,700,000

SCHEDULE FOR COST OF GOODS SOLD (CONT.)


Praticulars
Total manufacturing cost
(+)Beginning work in process inventory
Total work in process for the period
(-)Ending work in process
Cost of goods manufactured

(+)Beginning finished goods inventory


Goods available for sale
(-)Ending finished goods inventory
Cost of goods sold

Amount

Amount
14,700,000
2,500,000
17,200,000
1,200,000
16,000,000

4,000,000
20,000,000
2,500,000
17,500,000

ROADSTAR BICYCLE CO. LTD.S


INCOME STATEMENT(CONTRIBUTION FORMAT)
Particulars

Amount(tk.)

Sales
(-)Variable cost:
Direct material
Direct labor
Manufacturing overhead
Sales commission
Others cost

22,500,000
6,700,000
5,000,000
3,000,000
500,000
2,300,000

Contribution margin
(-)Fixed cost:
Administrative cost
Insurance cost
Depreciation cost
Advertisement cost
Net operating income

Amount(tk.)

17,500,000
5,000,000

1,000,000
500,000
500,000
500,000

2,500,000
2,500,000

6-32

CONTRIBUTION MARGIN RATIO (CM RATIO)


Roadstar Bicycle Company
Contribution Income Statement
For the end of the year 2014
Total
Per Unit
Sales (3000bicycles)
22,500,000.00
7,500.00
Less: Variable expenses
17,500,000
5,833
Contribution margin
5,000,000
1,667.00
Less: Fixed expenses
2,500,000
Net operating income
2,500,000.00

$5,000,000 $22,500,000 = 22%

CM Ratio
100%
78%
22%

BREAK EVEN POINT


In unit sales:
Profit = Unit CM * Q Fixed expenses
0 = 1666.7*Q 2,500,000
Q = 1500 units

In dollar sales=

Fixed expenses
CM Ratio
= tk. 2,500,000/0.2222
= tk. 11,245,000

BREAK EVEN POINTS ON GRAPH


Break even point

Total revenue

Total sales

Variable cost

2.5m
Fixed Expense

1500

Unit sales

WHAT IF ANALYSIS

If we increase sales volume by 1000 units


i.e. 4000units and average sales price
decrease by tk.500 i.e. tk.7000, then the
scenario is:

Profit=Unit CM*Q Fixed expense


=1667*4000 - 2,500,000
=4,166,667

CVP ANALYSIS
The average selling price of a of a bicycle is tk.7500
and the average variable expense per bicycle is tk.
5833 . The average fixed expense per year is
tk.2.5m. Using the formula method we determine the
sales dollars that must be generated to attain target
profits of tk.3m per year.
Profit = (Sales variable expense) Fixed expenses
3,000,000= Sales 17,500,000 2,500,000
Sales = tk.23,000,000
Per unit sales = 23000,000/3000 Units = tk.7,667

NEW PROMOTION

20% DISCOUNT FOR


FBS STUDENT
INSTALLMENT
PAYMENT SYSTEM
FOR STUDENTS

ANY
QUESTION
??