Product Details:

Our product’s name is Bakarkhani which is a popular crisp in old Dhaka. It is basically a
traditional food item of Old Dhaka area. The food has a significant history. It was named after
the Landlord Aga Baker Kha and her wife Khani Begum. It is a very delicious food. It can be
eaten with tea and milk. People can take it as their breakfast and also can take it at afternoon.
The production process is so easy that anyone can make it at home. It is made of Flour, Salt, Oil,
Dalda and some water. It takes a very few times to make some bakarkhani. People of Old Dhaka
receive their guests with bakarkhani. Everyone is very much familiar with the product.

Production Process:
Flour, Oil, Salt, Water, Dalda is the most necessary things to make bakarkhani. The process of
making bakarkhani is also very easy.

Steps to make bakarkhani :

1. At first put different raw materials in different pots.

2. Then mix flour and oil with water in a pot and rub it to make crisp.

3. Dalda need to be melted and as it is hot, it is needed some time to make it cold again.

4. Then again dalda is mixed with the flour and oil. This time salt is also needed.

5. Then cut the mixture in a shape of small bread.

6. Put them into the stove.

7. At last after sometime it will be cooked and put it out from the stove.
Determining the Cost of Product

 Direct Materials:
Bakarkhani’s main materials are Flour, oil, salt, water and dalda. All the materials are
available in the market. Besides these are not costly at all.
Unit of product: 1kg
Raw materials needed to produce 1kg bakarkhani :

Materials Quantity Price

Flour ½ kg 20 BDT
Salt 50gm 5 BDT
Dalda 100g 8 BDT
Water ½ liter 5 BDT
Oil 250g 20 BDT

Total 58 BDT

 Direct Labor:
There are 2 labors in the factory. They worked for 6 hours a day to produce bakarkhani
and they can manage to produce 3kg bakarkhani in an hour. So they need only 20
minutes to produce 1kg of bakarkhani.

Total unit: 1kg

Direct labor hour per unit: 0.017

Direct Labor cost per hour: BDT 60

Total direct labor cost per unit: BDT 20.

 Note: 2 labor can produce 3kg bakarkhani in an hour and it costs BDT 60. So it takes
only 20 minutes and costs BDT 20 to produce 1kg.

Manufacturing overhead:

Manufacturing overhead costs to produce 1kg bakarkhani are given below:

Electricity bill: BDT 7

Factory Rent : BDT 15

There is a fixed cost. That is the cost of stove. It cost BDT 10000 when the owner started
producing bakarkhani.

Total manufacturing overhead cost = 7 + 15 = BDT 23.

COST OF THE PRODUCT: (1kg)

Details Amount
Direct materials 58

Direct labor 20

Manufacturing overhead 23

Total 101
Product Price and Profit Margin:
They sell 1kg of bakarkhani at a cost of 140 taka.

We collected the information of last month that is march,2017 and made an income
statement.

Details Amount

Sales ( 540 kg * BDT 140 ) 75600

Deduct : Cost of goods sold 54540

21060

Deduct : Factory rent 6000

Net income 15060

Profit Margin:

Profit Margin = Net income/ Net sales

= 15060/75600
= .20
= 20%
 Contribution Margin, Breakeven point,
Breakeven Revenue Analysis

●Contribution Margin:

CONTRIBUTION MARGIN PER UNIT

Selling price 140
Less: Variable Expenses
101

Contribution Margin 39

●Breakeven Point:
Breakeven Point Analysis
Total Fixed Cost 10000

/Contribution Margin per unit 39

Breakeven Units 25.65 kg

Breakeven Revenue = Fixed cost ÷ CM Ratio

= 10000 ÷ 0.28

= 3571.43
Reference:

MD. FARUK
Shop : Faruker Bakarkhani
Address : Mirpur-2 , 1216. (Behind Mirpur thana)
Phone : 01516181095