Professional Documents
Culture Documents
1
DECLARATION
I here declare that the project report entitled ““COST ANALYSIS AND
CONTROL”
” has been prepared by me in partial fulfillment of the requirements for the
award of the degree of “MASTER OF BUSINESS ADMINISTRATION” I
also declare that this project work is a result of my effort and it has not
been submitted to any other university for the award of any degree or
diploma.
PLACE:
JOOTURU CHAITHANYA
H.T NO: 162011672048
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ACKNOWLEDGMENT
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ABSTRACT
The project is taken up with the object to study Cost Analysis System
HEROMOTORSPVTLTD.
The project is mainly a study to know about the meaning of the Cost Accounting, Cost
preparation Process and comparing cost provision with actual. The main aim of the study is to
know the effectiveness of the current and if any requirements for improvements. It’s also
Conclusion is drawn on the basis of analysis of the cost accounting. The analysis reveals the
company financial position i.e. it’s Expenditure and Revenue generated
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CONTENT
CHAPTER -1 INTRODUCTION
LETERATURE REVIEW
CHAPTER -2
CHAPTER -3 COMPANY PROFILE
INDUSTRY PROFILE
BIBLIOGRAPHY
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CHAPTER-1
INTRODUCTION
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INTRODUCTION
COST:
Cost is essential in every walk of our life – national, domestic and Business. A cost is
prepared to have effective utilization of funds and for the realization of objective as
efficiently as possible. Costing is a powerful tool to the management for performing its
functions i.e., formulation plans, coordination activities and controlling operations etc.,
efficiently. For efficient and effective management planning and control are tow highly
essential functions. Costing and cost control provide a set of basic techniques for planning
and control.A cost fixes a target in terms of rupees or quantities against which the actual
performance is measured. A cost is closely related to both the management function as well
as the accounting function of an organization.
As the size of the organization increases, the need for costing is correspondingly more
because a cost is an effective tool of planning and control. Cost is helpful in coordinating the
various activities (such as production, sales, purchase etc) of the organization with result that
all the activities precede according to the objective. Costs are means of communication. Ideas
of the top management are given the practical shape. As the activities of various department
heads are coordinated at the much needed for the very success of an organization. Cost is
necessary to future to motivate the staff associated, to coordinate the activities of different
departments and to control the performance of various persons operating at different
levels.Costs may be divided into two basic classes. Capital and operating costs. Capital cost
is directed towards proposed expenditure for new projects and often require special financing.
The operating costs are directed towards achieving short-term operational goals of the
organization for instance, production or profit goals in a business firm. Operating costs may
be sub-divided into various departmental of functional costs.
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Definition of 'Cost-Benefit Analysis'
A process by which business decisions are analyzed. The benefits of a given situation or
business-related action are summed and then the costs associated with taking that action are
subtracted. Some consultants or analysts also build the model to put a dollar value on
intangible items, such as the benefits and costs associated with living in a certain town. Most
analysts will also factor opportunity cost into such equations.
You may have been intensely creative in generating solutions to a problem, and rigorous in
your selection of the best one available. This solution may still not be worth implementing, as
you may invest a lot of time and money in solving a problem that is not worthy of this effort.
Cost Benefit Analysis or cba is a relatively simple and widely used technique for deciding
whether to make a change. As its name suggests, to use the technique simply add up the value
of the benefits of a course of action, and subtract the costs associated with it.
Costs are either one-off, or may be ongoing. Benefits are most often received over time. We
build this effect of time into our analysis by calculating a payback period. This is the time it
takes for the benefits of a change to repay its costs. Many companies look for payback over a
specified period of time – e.g. three years.
In its simple form, cost-benefit analysis is carried out using only financial costs and financial
benefits. For example, a simple cost/benefit analysis of a road scheme would measure the
cost of building the road, and subtract this from the economic benefit of improving transport
links. It would not measure either the cost of environmental damage or the benefit of quicker
and easier travel to work.
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NEED OF THE STUDY:
When a company must generate more cash as fast as possible, management will have to
decide which costs can be most effectively reduced. If the reduction is needed quickly,
expenses cut first will normally be those that are not fixed or directly tied to production. It is
not a good idea to drastically reduce expenses that produce the company product or service
without careful evaluation.
Keeping the competitive edge means keeping the company razor sharp. There is no room for
laxness which dulls the ability of a company to be responsive to market trends. Changes can
occur rapidly, and a company that cannot respond with new methods, new material usage,
service efficiency changes, or technological adaptability will be quickly outperformed by
other businesses. The importance of cost reduction strategies lies in its contribution to a
company's honing of performance.
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SCOPE OF THE STUDY:
Since it will not be possible to conduct a micro level study of all type industries in Andhra
Pradesh, the study is restricted to Hero MotoCorp Ltd only.
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OBJECTIVES OF STUDY:
To provide the material frame work of cost and Cost Control Analysis
To analyze the cost system in practice in Hero MotoCorp Ltd with particular
reference to their objectives and phases of organizational and re-appropriation.
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SOURCES OF DATA:
The data of Hero MotoCorp Ltd have been collected mainly from secondary sources
viz.,
Form the concerned officers of the Hero MotoCorp Ltd
Hero MotoCorp Ltd journals.
Accounting books, records.
Key books of concerned title.
Statistical records
Hero MotoCorp Ltd library.
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METHODOLOGY:
The proposed study is carried with the help of both primary and secondary sources of
data.
PRIMARY DATA:
The primary data is collected by interacting with the finance manager and other
concerned executives at the administrative office of the company.
SECONDARY DATA:
All the secondary data used for the study has been extracted from the annual reports,
manuals and other published material of the company.
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LIMITATIONS:
Estimates are used as basis for cost plan and estimates are based mostly on available
facts and best managerial judgment
Cost control cannot reduce the managerial function to a formula. It is only a
managerial.
Tool which increase effectiveness of managerial control.
The use of cost may be to restricted use of resources. Costs an often taken as limits.
Efforts may therefore not be made to exceed the performance beyond the cost targets.
Frequent changes may be called for in costs due to first changing industrial climate.
In order that a system may be successful, adequate costs education should be imparted
at least through the formative period. Sufficient training programs should be arranged
to make employees give positive response to cost activities.
The study is the limited up to the date and information provided by Hero MotoCorp
Ltd and its annual reports.
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CHAPTER-II
INDUSTRY PROFILE
&
COMPANY PROFILE
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CHAPTER-II
INDUSTRY PROFILE
&
COMPANY PROFILE
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INDUSTRY PROFILE
The Indian auto industry is one of the largest in the world with an annual production of 23.37
million vehicles in FY 2017-16, following a growth of 8.68 per cent over the last year.
The automobile industry accounts for 7.1 per cent of the country's gross domestic product
(GDP).
The Two Wheelers segment with 81 per cent market share is the leader of the Indian
Automobile market owing to a growing middle class and a young population. Moreover, the
growing interest of the companies in exploring the rural markets further aided the growth of
the sector. The overall Passenger Vehicle (PV) segment has 13 per cent market share.
India is also a prominent auto exporter and has strong export growth expectations for the near
future. In FY 2017-16, automobile exports grew by 15 per cent over the last year. In addition,
several initiatives by the Government of India and the major automobile players in the Indian
market are expected to make India a leader in the Two Wheeler (2W) and Four Wheeler (4W)
market in the world by 2020.
Market Size
The industry produced a total 14.25 million vehicles including PVs, commercial vehicles
(CVs), three wheelers (3W) and 2W in April-October 2015 as against 13.83 in April-October
2017, registering a marginal growth of 3.07 per cent year-on-year.
The sales of PVs grew by 8.51 per cent in April-October 2015 over the same period last year.
The overall CVs segment registered a growth of 8.02 per cent in April-October 2015 as
compared to same period last year. Medium & Heavy Commercial Vehicles (M&HCVs)
registered very strong growth of 32.3 per cent while sales of Light Commercial Vehicles
(LCVs) reduced by 5.24 per cent during April-October 2015 year-on-year.
In April-October 2015, overall automobile exports grew by 5.78 per cent. PVs, CVs, 3Ws
and 2Ws registered growth of 6.34 per cent, 17.95 per cent, 18.59 per cent and 3.22 per cent
respectively in April-October 2015 over April- October 2017.
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Investments
In order to keep up with the growing demand, several auto makers have started investing
heavily in various segments of the industry during the last few months. The industry has
attracted foreign direct investment (FDI) worth US$ 13.48 billion during the period April
2000 to June 2015, according to data released by Department of Industrial Policy and
Promotion (DIPP).
Some of the major investments and developments in the automobile sector in India are as
follows:
Global auto major Ford plans to manufacture in India two families of engines by
2017, a 2.2 litre diesel engine codenamed Panther, and a 1.2 litre petrol engine
codenamed Dragon, which are expected to power 270,000 Ford vehicles globally.
The world’s largest air bag suppliers Autoliv Inc, Takata Corp, TRW Automotive Inc
and Toyoda Gosei Co are setting up plants and increasing capacity in India.
General Motors plans to invest US$ 1 billion in India by 2020, mainly to increase the
capacity at the Talegaon plant in Maharashtra from 130,000 units a year to 220,000 by
2025.
US-based car maker Chrysler has planned to invest Rs 3,500 crore (US$ 525 million)
in Maharashtra, to manufacture Jeep Grand Cherokee model.
Mercedes Benz has decided to manufacture the GLA entry SUV in India. The
company has doubled its India assembly capacity to 20,000 units per annum.
Germany-based luxury car maker Bayerische Motoren Werke AG’s (BMW) local unit
has announced to procure components from seven India-based auto parts makers.
Mahindra Two Wheelers Limited (MTWL) acquired 51 per cent shares in France-
based Peugeot Motorcycles (PMTC).
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Government Initiatives
The Government of India encourages foreign investment in the automobile sector and allows
100 per cent FDI under the automatic route.
In the Union budget of 2015-16, the Government has announced to provide credit of
Rs 850,000 crore (US$ 127.5 billion) to farmers, which is expected to boost the
tractors segment sales.
The Government plans to promote eco-friendly cars in the country i.e. CNG based
vehicle, hybrid vehicle, and electric vehicle and also made mandatory of 5 per cent
ethanol blending in petrol.
The government has formulated a Scheme for Faster Adoption and Manufacturing of
Electric and Hybrid Vehicles in India, under the National Electric Mobility Mission
2020 to encourage the progressive induction of reliable, affordable and efficient
electric and hybrid vehicles in the country.
The Automobile Mission Plan (AMP) for the period 2006–2016, designed by the
government is aimed at accelerating and sustaining growth in this sector. Also, the
well-established Regulatory Framework under the Ministry of Shipping, Road
Transport and Highways, plays a part in providing a boost to this sector.
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Road Ahead
India’s automotive industry is one of the most competitive in the world. It does not cover 100
per cent of technology or components required to make a car but it is giving a good 97 per
cent, as highlighted by Mr Vicent Cobee, Corporate Vice-President, Nissan Motor’s Datsun.
Leading auto maker Maruti Suzuki expects Indian passenger car market to reach four million
units by 2020, up from 1.97 million units in 2014-15.
The Indian automotive sector has the potential to generate up to US$ 300 billion in annual
revenue by 2026, create 65 million additional jobs and contribute over 12 per cent to India’s
Gross Domestic Product, as per the Automotive Mission Plan 2016-26 prepared jointly by the
Society of Indian Automobile Manufacturers (SIAM) and government.
The growth story for the Indian automobile industry in 2014 rode on the two-wheeler
segment and not on passenger cars or commercial vehicles, as high interest rates and a
stuttering manufacturing industry kept a check on demand.The year also saw Competition
Commission of India (CCI) levying a penalty of Rs.2,544.65 crore ($415) on 14 car makers
for their restrictive trade practices by preventing independent repairers coming into the
market. Some of the leading car makers also had to recall some models over defective
components.
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When other segments like passenger cars and commercial vehicles logged negative growth,
the two-wheeler makers registered around 13 percent growth between January and October.
Riding on the two-wheeler sector's growth, the automotive industry grew 9.8 percent by
volume year-on-year (YoY) between January and October.The two-wheeler segment is the
only one that has clocked positive growth at 12.9 percent YoY (year-on-year) to reach sales
of nearly 13.5 million units by October. This can be attributed to the low cost of two wheelers
in India," Vijay Kakade, vice president for automotive and transportation practice at Frost &
Sullivan, told IANS.He said the light commercial vehicle (LCV) segment has been the worst
hit, with sales reducing to approximately 330,000 units -- an 18.9 percent YoY fall over
2013."The passenger car, medium and heavy commercial vehicle segments contracted by 0.8
and 6.5 percent respectively during the period, compared to 2013. The reduction in sales can
be attributed to the slowdown and the high interest rates set by the RBI (Reserve Bank of
India) reducing the availability of finance options to the public," Kakade added.
"These segments have shown positive signs over the past few months, which is expected to
lead to growth in the next year.""The year 2014 has been a year of stagnation, which is a
positive sign as the decline has stopped. The industry has shown signs of growth, albeit
slower than expected, over the past few months," Kakade remarked.
P. Balendran, vice president, General Motors India, had similar views to share with IANS:
"Of late, we have seen some movements in new entries driven by novelty factors and some
select manufacturers have been getting the benefits too."
He said the market has not shown any movement forward, despite the excise duty reduction,
while the customer sentiment has not picked up due to sticky interest rates, which remain at
high levels.
"Although fuel prices have started coming down significantly, the enquiry levels at
showrooms have come down and conversions are not taking place at all. The sales of diesel
vehicles are also tapering off because of the narrowing price gap vis-a-vis petrol," Balendran
added.
Expecting the government to continue with a lower excise duty regime for small/mid-
sized/big cars and sports utility vehicles (SUV) till March 2015, Balendran said the rates
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should be continued till the Goods and Services Tax ( GST) is introduced -- aiding the
turnaround of the auto sector.
COMPANY PROFILE:
Hero MotoCorp Ltd. (Formerly Hero Honda Motors Ltd.) is the world's largest manufacturer
of two - wheelers, based in India.
In 2001, the company achieved the coveted position of being the largest two-wheeler
manufacturing company in India and also, the 'World No.1' two-wheeler company in terms of
unit volume sales in a calendar year. Hero MotoCorp Ltd. continues to maintain this position
till date.
Vision
The story of Hero Honda began with a simple vision - the vision of a mobile and an
empowered India, powered by its two wheelers. Hero MotoCorp Ltd., company's new
identity, reflects its commitment towards providing world class mobility solutions with
renewed focus on expanding company's footprint in the global arena.
Mission
Hero MotoCorp’s mission is to become a global enterprise fulfilling its customers' needs and
aspirations for mobility, setting benchmarks in technology, styling and quality so that it
converts its customers into its brand advocates. The company will provide an engaging
environment for its people to perform to their true potential.
Manufacturing
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at Haridwar, in the hill state of Uttrakhand.
Distribution
The Company's growth in the two wheeler market in India is the result of an intrinsic ability
to increase reach in new geographies and growth markets. Hero MotoCorp’s extensive sales
and service network now spans over to 6000 customer touch points. These comprise a mix of
authorized dealerships, service & spare parts outlets and dealer-appointed outlets across the
country.
Brand
The new Hero is rising and is poised to shine on the global arena. Company's new identity
"Hero MotoCorp Ltd." is truly reflective of its vision to strengthen focus on mobility and
technology and creating global footprint. Building and promoting new brand identity will be
central to all its initiatives, utilizing every opportunity and leveraging its strong presence
across sports, entertainment and ground-level activation
HERO'S MANDATE
Hero is a world leader because of its excellent manpower, proven management, extensive
dealer network, efficient supply chain and world-class products with cutting edge technology
from Company, Japan. The teamwork and commitment are manifested in the highest level of
customer satisfaction, and this goes a long way towards reinforcing its leadership status
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BRIEF PROFILE OF DIRECTORS
Late Dr. Brijmohan Lall Munjal (1st July 1923 to 1st November 2015)
Mr. Brijmohan Lall Munjal is the founder Director and Chairman of the Company and the $
3.2 billion Hero Group. He is the Past President of Confederation of Indian Industry (CII),
Society of Indian Automobile Manufacturers (SIAM) and was a Member of the Board of the
Country's Central Bank (Reserve Bank of India). In recognition of his contribution to
industry, Mr. Munjal was conferred the Padma Bhushan Award by the Union Government.
Mr. Munjal is the Chairman, Managing Director & CEO of the Company. He is responsible
for growth and strategic planning for the entire Group. A graduate in Mechanical
Engineering, Mr. Munjal has been instrumental in bringing about technological and
managerial excellence in the Company's operations. He has been the Chairman of several
Committees of CII.
He is also on the board of Indian Institute of Management, Lucknow and Indian School of
Business. An avid golfer, Mr. Munjal is Past Chairman of the Asian PGA Tour Board of
Directors and the Past President of Professional Golfers Association of India (PGAI). Under
his guidance, Hero MotoCorp launched the Hero Indian Sports Academy (HISA) in
collaboration with Laureus Foundation to provide equal opportunities in sports to various
communities and to reward talent in the country.
A company that believes in maintaining ecological standards along with business standards.
"We must do something for the community from whose land we generate our wealth." –
Chairman Late Dr.Brijmohan Lall Munjal.
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At Hero MotoCorp, our goal isn't limited to business but encompasses the broader spectrum
of serving humanity through social initiatives. Hero MotoCorp takes a stand as a socially
responsible enterprise respectful of its environment.
Hero MotoCorp has been strongly devoted not only to environmental conservation programs
but also expresses the increasingly inseparable balance between economic concerns,
environmental and social issues faced by business. A business must not grow at the expense
of mankind but must serve humankind at large.
Environment Policy
We at Hero MotoCorp have been committed to demonstrate excellence in our environmental
performance on a continuous basis, as an intrinsic element of our corporate philosophy
Quality Policy
Excellence in quality is the core value of Hero MotoCorp philosophy.
We are committed at all levels to achieve high quality in whatever we do, particularly in our
products and services which will meet and exceed customer's growing aspirations through:
Innovation in products, processes and services.
Continuous improvement in our total quality management systems.
Teamwork and responsibility.
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Safety Policy
We believe that safe work practices lead to better business performance, motivated workforce
and higher productivity.
We shall create a safety culture in the organization by:
Integrating safety and health matters in all our activities.
Promoting safety and health awareness amongst employees, suppliers and contractors.
Continuous improvements in safety performance through precautions be sides
participation and training of employees.
Remuneration Policy
The remuneration policy of the Directors has been designed to keep pace with the business
environment and market linked positioning. The Remuneration & Nomination Committee
determines and recommends to the Board the compensation payable to Directors.
Remuneration for the Executive Directors consists of a fixed component and a variable
component linked to the long term vision, medium term goals and annual business plans.
Related Party Transactions Policy
Hero MotoCorp Ltd. (hereinafter referred to as HMCL or the company) recognizes that
Related Party Transactions can present potential or actual conflicts of interest and may raise
questions about whether such transactions are consistent with the Company and its
shareholders’ best interests and in compliance to the provisions of the Companies Act, 2013
and Clause 49 of the Listing Agreement.
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has been formulated in accordance with the Regulation 9 of the Securities and Exchange
Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing
Regulations). The Policy shall come into effect from December 1, 2015.
D. Indradath Reddy
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Karizma ZMR
Karizma
Xtreme Sports
30
Xtreme
Hunk
Impulse
Achiever
Ignitor
31
Glamour Programmed FI
Glamour
Super Splendor
Passion XPRO
32
Passion PRO
Passion PRO TR
Splendor iSmart
33
Splendor PRO
Splendor+
HF Deluxe ECO
HF Deluxe
34
HF Dawn
Duet
Maestro Edge
Maestro
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Pleasure
To entertain the customers the showroom providing a customers huge having pool game,
Internet facility and television with home theatre system. They provide bike maintenance
programs on every week. According to other dealers PHOENIX motors in first in sales and
best in service. They treat customer, is the very important person at PHOENIX motors
customer satisfaction is their motto, why because, the well satisfied customer is the best
advertisement. They provide better value for the customers and as well as employees also.
At PHONIX motors the customer is the boss.
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CHAPTER-III
REVIEW OF LITERATURE
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Theory
Cost–benefit analysis is often used by governments and others, e.g. businesses, to evaluate
the desirability of a given policy. It is an analysis of the expected balance of benefits and
costs, including an account of foregone alternatives and the status quo, helping predict
whether the benefits of a policy outweigh its costs, and by how much (i.e. one can rank
alternate policies in terms of the ratio of costs and benefit). Altering the status quo by
choosing the lowest cost-benefit ratio can improve pareto efficiency, in which no alternative
policy can improve one group's situation without damaging another. Generally, accurate cost-
benefit analysis identifies choices that increase welfare from a utilitarian perspective.
Otherwise, cost-benefit analysis offers no guarantees of increased economic efficiency or
increases of social welfare; generally positive microeconomic theory is moot when it comes
to evaluating the impact on social welfare of a policy.
Process
2. List stakeholders.
3. Select measurement(s) and measure all cost and benefits elements.
4. Predict outcome of cost and benefits over relevant time period.
5. Convert all costs and benefits into a common currency.
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Valuation
CBA attempts to measure the positive or negative consequences of a project, which may
include:
3. Externality effects
The actual compensation an individual would require to have their welfare unchanged by a
policy is inexact at best. Surveys (stated preference techniques) or market behavior (revealed
preference techniques) are often used to estimate the compensation associated with a policy,
however survey respondents often have strong incentives to misreport their true preferences
and market behavior does not provide any information about important non-market welfare
impacts.
One controversy is valuing a human life, e.g. when assessing road safety measures or life-
saving medicines. However, this can sometimes be avoided by using the related technique of
cost-utility analysis, in which benefits are expressed in non-monetary units such as quality-
adjusted life years. For example, road safety can be measured in terms of cost per life saved,
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without formally placing a financial value on the life. However, such non-monetary metrics
have limited usefulness for evaluating policies with substantially different outcomes.
CBA usually tries to put all relevant costs and benefits on a common temporal footing using
time value of money calculations. This is often done by converting the future expected
streams of costs and benefits into a present value amount using a discount rate. Empirical
studies and a technical framework suggest that in reality, people do discount the future like
this.
The choice of discount rate is subjective. A smaller rate values future generations equally
with the current generation. Larger rates (e.g. a market rate of return) reflects humans'
attraction to time inconsistency—valuing money that they receive today more than money
they get in the future. The choice makes a large difference in assessing interventions with
long-term effects, such as those affecting climate change. One issue is the equity premium
puzzle, in which long-term returns on equities may be rather higher than they should be. If so
then arguably market rates of return should not be used to determine a discount rate, as doing
so would have the effect of undervaluing the distant future (e.g. climate change).
Risk associated with project outcomes is usually handled using probability theory. This can
be factored into the discount rate (to have uncertainty increasing over time), but is usually
considered separately. Particular consideration is often given to risk aversion—the irrational
preference for avoiding loss over achieving gain. Expected return calculations does not
account for the detrimental effect of uncertainty.
Uncertainty in CBA parameters (as opposed to risk of project failure etc.) can be evaluated
using a sensitivity analysis, which shows how results respond to parameter changes.
Alternatively a more formal risk analysis can be undertaken using Monte Carlo simulations.
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History
The concept of CBA dates back to an 1848 article by Jules Dupuit and was formalized in
subsequent works by Alfred Marshall. The Corps of Engineers initiated the use of CBA in the
US, after the Federal Navigation Act of 1936 effectively required cost–benefit analysis for
proposed federal waterway infrastructure. The Flood Control Act of 1939 was instrumental in
establishing CBA as federal policy. It demanded that "the benefits to whomever they accrue
in excess of the estimated costs.
Public Policy
The application for broader public policy started from the work of Otto Eckstein, who in
1958 laid out a welfare economics foundation for CBA and its application for water resource
development. Over the 1960’s, CBA was applied in the US for water quality, recreation
travel and land conservation. During this period, the concept of option value was developed
to represent the non-tangible value of preserving resources such as national parks.
Transportation Investment
CBA application for transport investment started in the UK, with the M1 motorway project in
1960. It was later applied on many projects including London Underground's Victoria Line.
Later, the New Approach to Appraisal (NATA) was introduced by the then Department for
Transport, Environment and the Regions. This presented cost–benefit results and detailed
environmental impact assessments in a balanced way. NATA was first applied to national
road schemes in the 1998 Roads Review but subsequently rolled out to all transport modes.
As of 2011 it was a cornerstone of transport appraisal in the UK and is maintained and
developed by the Department for Transport. The EU's 'Developing Harmonised European
Approaches for Transport Costing and Project Assessment' (HEATCO) project, part of its
Sixth Framework Programme, reviewed transport appraisal guidance across EU member
states and found that significant differences exist between countries. HEATCO's aim is to
develop guidelines to harmonise transport appraisal practice across the EU.
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Transport Canada promoted the use of CBA for major transport investments with the 1994
issuance of its Guidebook.
In the US, both federal and state transport departments commonly apply CBA, using a variety
of available software tools including HERS, BCA.Net, StatBenCost, Cal-BC, and TREDIS.
Guides are available from the Federal Highway Administration, Federal Aviation
Administration, Minnesota Department of Transportation, California Department of
Transportation (Caltrans), and the Transportation Research Board Transportation Economics
Committee.
Background
Cost-Benefit Analysis (CBA) estimates and totals up the equivalent money value of the
benefits and costs to the community of projects to establish whether they are worthwhile.
These projects may be dams and highways or can be training programs and health care
systems.
The idea of this economic accounting originated with Jules Dupuit, a French engineer whose
1848 article is still worth reading. The British economist, Alfred Marshall, formulated some
of the formal concepts that are at the foundation of CBA. But the practical development of
CBA came as a result of the impetus provided by the Federal Navigation Act of 1936. This
act required that the U.S. Corps of Engineers carry out projects for the improvement of the
waterway system when the total benefits of a project to whomsoever they accrue exceed the
costs of that project. Thus, the Corps of Engineers had create systematic methods for
measuring such benefits and costs. The engineers of the Corps did this without much, if any,
assistance from the economics profession. It wasn't until about twenty years later in the
1950's that economists tried to provide a rigorous, consistent set of methods for measuring
benefits and costs and deciding whether a project is worthwhile. Some technical issues of
CBA have not been wholly resolved even now but the fundamental presented in the following
are well established.
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Principles of Cost Benefit Analysis
One of the problems of CBA is that the computation of many components of benefits and
costs is intuitively obvious but that there are others for which intuition fails to suggest
methods of measurement. Therefore some basic principles are needed as a guide.
The valuation of benefits and costs should reflect preferences revealed by choices which have
been made. For example, improvements in transportation frequently involve saving time. The
question is how to measure the money value of that time saved. The value should not be
merely what transportation planners think time should be worth or even what people say their
time is worth. The value of time should be that which the public reveals their time is worth
through choices involving tradeoffs between time and money. If people have a choice of
parking close to their destination for a fee of 50 cents or parking farther away and spending 5
minutes more walking and they always choose to spend the money and save the time and
effort then they have revealed that their time is more valuable to them than 10 cents per
minute. If they were indifferent between the two choices they would have revealed that the
value of their time to them was exactly 10 cents per minute.
The most challenging part of CBA is finding past choices which reveal the tradeoffs and
equivalencies in preferences. For example, the valuation of the benefit of cleaner air could be
established by finding how much less people paid for housing in more polluted areas which
otherwise was identical in characteristics and location to housing in less polluted areas.
Generally the value of cleaner air to people as revealed by the hard market choices seems to
be less than their rhetorical valuation of clean air.
Figure 1
When the increase in consumption is small compared to the total consumption the gross
benefit is adequately approximated, as is shown in a welfare analysis, by the market value of
the increased consumption; i.e., market price times the increase in consumption.
It is sometimes necessary in CBA to evaluate the benefit of saving human lives. There is
considerable antipathy in the general public to the idea of placing a dollar value on human
life. Economists recognize that it is impossible to fund every project which promises to save a
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human life and that some rational basis is needed to select which projects are approved and
which are turned down. The controversy is defused when it is recognized that the benefit of
such projects is in reducing the risk of death. There are many cases in which people
voluntarily accept increased risks in return for higher pay, such as in the oil fields or mining,
or for time savings in higher speed in automobile travel. These choices can be used to
estimate the personal cost people place on increased risk and thus the value to them of
reduced risk. This computation is equivalent to placing an economic value on the expected
number of lives saved.
The impact of a project is the difference between what the situation in the study area would
be with and without the project. This that when a project is being evaluated the analysis must
estimate not only what the situation would be with the project but also what it would be
without the project. For example, in determining the impact of a fixed guideway rapid transit
system such as the Bay Area Rapid Transit (BART) in the San Francisco Bay Area the
number of rides that would have been taken on an expansion of the bus system should be
deducted from the rides provided by BART and likewise the additional costs of such an
expanded bus system would be deducted from the costs of BART. In other words, the
alternative to the project must be explicitly specified and considered in the evaluation of the
project. Note that the with-and-without comparison is not the same as a before-and-after
comparison. Another example shows the importance of considering the impacts of a project
and a with-and-without comparison. Suppose an irrigation project proposes to increase cotton
production in Arizona.
45
The impacts of a project are defined for a particular study area, be it a city, region, state,
nation or the world. In the above example concerning cotton the impact of the project might
be zero for the nation but still be a positive amount for Arizona.
The nature of the study area is usually specified by the organization sponsoring the analysis.
Many effects of a project may "net out" over one study area but not over a smaller one. The
specification of the study area may be arbitrary but it may significantly affect the conclusions
of the analysis.
Sometimes an impact of a project can be measured in two or more ways. For example, when
an improved highway reduces travel time and the risk of injury the value of property in areas
served by the highway will be enhanced. The increase in property values due to the project is
a very good way, at least in principle, to measure the benefits of a project. But if the
increased property values are included then it is unnecessary to include the value of the time
and lives saved by the improvement in the highway. The property value went up because of
the benefits of the time saving and the reduced risks. To include both the increase in property
values and the time saving and risk reduction would involve double counting.
A cost benefit analysis finds, quantifies, and adds all the positive factors. These are the
benefits. Then it identifies, quantifies, and subtracts all the negatives, the costs. The
difference between the two indicates whether the planned action is advisable. The real trick to
doing a cost benefit analysis well is making sure you include all the costs and all the benefits
and properly quantify them. Should we hire an additional sales person or assign overtime? Is
it a good idea to purchase the new stamping machine? Will we be better off putting our free
cash flow into securities rather than investing in additional capital equipment? Each of these
questions can be answered by doing a proper cost benefit analysis.
Once you have collected ALL the positive and negative factors and have quantified them you
can put them together into an accurate cost benefit analysis.
46
Some people like to total up all the positive factors (benefits), total up all the negative factors
(costs), and find the difference between the two. I prefer to group the factors together. It
makes it easier for you, and for anyone reviewing your work, to see that you have include all
the factors on both sides of the issues that make up the cost benefit analysis. For the example
above, our cost benefit analysis might look something like this:
OBJECTIVES OF COST:
The primary objective of cost control’s to help the management is systematic planning
and in controlling the operations of the enterprise. The primary objective can be met only of
there is proper communication and coordination amongst different within the organization.
Thus the objectives can be stated as:
1. PLANNING:
Businesses require planning to ensure efficient and maximum use of their resources.
The first step in planning is to define the broad aims and objectives of the business. Then,
strategies to achieve the desired goals are formulated and tentative schedule of eh proposed
combinations of the various factors of production, which is the most profitable for the defined
period. Cost influences strategies that need to be followed by the originations. It cultivates
forced planning aiming managers.
2. CO-ORDINATION:
Co-ordination is managerial functions under which all factors of production and all
departmental activities are balanced and integrated achieve the objectives of the organization.
Costing provides the basis for individual in all department to exchange ides on how best the
organizations objectives can be realized. Executives are forced ot think of the relationship
between their department and the company as a whole. This removes unconscious bases
against other departments. It also helps to identify weaknesses in the organization structure.
3. COMMUNICATIONS:
47
All people in the organization must know the objectives, policies and performances of
the organizations. They must have a clear understanding of their part in the organizations
goals. This is made possible by ensuring their participation in the costing process.
From the above definitions we can differentiated the three terms as costs are the
individuals objectives of a department, etc, where as costing may be said to be the act of
building cost. Cost control embraces all and in addition includes the science of planning the
costs to effect on overall management tool for the business planning and control.
ESSENTIALS OF COST:
The proper organization is essential for the successful preparation, maintenance and
administration of costs. A cost committee is formed which comprises the departmental heads
of various departments. All the functional heads are entrusted with the responsibility if
ensuring proper implementation of their respective departmental costs.
The chief executive is the overall in charge of cost system. He constitutes a cost
committee for preparing realistic costs. A cost officer is the convener of the cost committee
who co-ordinates the costs of different departments. The managers of different departments
are made responsible for their departmental costs.
COST OFFICER:
48
The chief executive appoints cost officer. Such cost officer also called as “cost
controller or cost director”. His rank should be equal to other functional managers.
The cost officer does not have the direct responsibility of preparing the costs. The
various functional managers prepare the costs. His role is that of a supervisor. The cost
officer has the specific duty of administering the cost. He is responsible for timely
completion of costing activity by various departments and for co-ordination between them so
the t there is a proper link between them. He is empowered to scrutinize the costs prepared by
different functional heads and to make changes in them. If the situation so demands.
The cost officer will be able to carry out his work only if is conversant with the
working of all the departments he must have technical knowledge of the business and should
also possess accounting knowledge.
3. COST COMMITTEE:
A cost committee is formed to assist the cost officer. The heads of the entire important
department’s are made members of this committee. The committee is responsible for
preparation and execution of costs. The members of this committee put up the case of their
respective departments and help the committee to take collective decisions, if necessary. The
cost committee is responsible for reviewing the costs prepared by various functional heads.
Co ordinate all the costs and approve the final costs, the cost officer acts as coordinator of
this committee. All the functional heads are entrusted with the responsibility of ensuring
proper of ensuring proper implementation of their respective final departmental costs.
4. COSTS CENTERS:
A cost centers is that part of the organization for which the cost is prepared. A cost
center may be a department, section of a department or any other part of the department.
Ideally, the head of every center should be a member of the cost committee. However, it must
be ensured that each cost center at least has an indirect representation in the cost committee.
49
The establishment of cost centers is essential for covering all parts of the organization
becomes easy. When different centers are establishment. The cost centers are also necessary
for cost control purposes.
5. COST MANUAL:
a) A cost manual is a document that spells out the duties and responsible of the various
executives concerned it specifies among various functional areas. A cost manual
covers the following matters.
b) A cost manual clearly defines the objectives of cost control system. It also gives the
benefits and principles of this system.
c) The duties and responsibilities of various persons dealing with preparation and exec
ton of costs are also given in a cost manual. It enables the management to know the
persons dealing with various aspects to costs and provides clarity on their duties and
responsibilities,
d) It gives information about the sanctioning authorities of various costs. The financial
powers of different managers are given in the manual for enabling he spending
amount on various expenses.
e) A proper table for costs including the sending of performance reports is drawn so that
every work starts in time and systematic control is exercise.
f) The specimen forms and number of copies to be listed for cost repots is also stated.
Cost involved should be clearly stated.
g) The length of various cost periods and control points is clearly given.
h) The procedure to the followed in the entire system is clearly stated.
i) A method of accounting to be used for various expenditures is also stated in the
manual.
The cost manual helps in documentation the role of every employee, his duties,
responsibilities the ways of undertaking various tasks etc. thus it also in reducing ambiguity
at any point of time.
6. COST PERIOD:
50
A cost period is the length of time for which a cost is prepared. It depends upon a
number of factors. The choice of a cost period depends upon the following considerations.
The types of cost (long/short)
All the above mentioned factors are taken into account while fixing the period of
costs. In this costing process the financial manager has to take the financial decision on the
costs.
A continuous costing system is a method of having two different cost periods with in
the same cost. The purpose of having this system is to have greater control in terms of
operational activities without losing sight is to have greater control in terms of it results in
incorporating the effect of changes in the short term on the long-term targets of the
organization.
The costs are prepared for all functional areas. These costs are interring dependent
and inter-related. A proper co-ordination among different costs in necessary for cost control
to be successful. The constraints on some costs may have an effect on other costs too. A
factor which influences all other costs is known as “key factor or principal factor”.
The key factor may not necessity remain the same. The raw materials supply may be
limited at one time but it may be easily available at another time. Similarly, other factors may
also improve at different times. The key factor highlights are limitations of the enterprise.
This will enable the management to improve the working of these departments where scope
for improvement exists.
51
REQUISITES FOR A SUCCESSFUL COST
CONTROL SYSTEM
For making a cost control system successful requisites are required.
1. CLARIFYING OBJECTIVES:
The costs are used to realize objectives of the business. The objective must be clearly
spelt out to that costs are properly prepared. In the absence of clear goals, the costs will also
be unrealistic.
Cost preparation and control is done are every level of management. Even though
costs are finalized at top level but involvement of persons from lower levels of management
is essential for their success. This necessitates proper delegation of authority and
responsibility.
4. COST EDUCATION:
The employees should be educated about the benefit of costing system. They should
be the benefits of costing system they should be educating about their roles in the success of
this system. Cost control may not be taken only as a control device by the employees but it
should be used as a tool to improve their efficiency.
52
5. FLEXIBILITY:
6. MOTIVATION:
Costs are to be implemented by human beings. Their successful implementation will
depend upon the interest shown by the employees. All persons should be motivated to
improve their working so that costing is successful. A proper system of motivation should be
introduced for making this system a success.
TYPES OF COSTS:
53
1. LONG -TERM COSTS:
The long-term costs prepared for a long period of five to ten years. They are
concerned with planning the operations of a firm over a considerably long period of time. The
financial “controller” exclusively for the top management usually prepares long-term costs.
These costs are very useful in terms of physical units (i.e. quantities) or percentages, since
accrued values may be difficult to forecast over such long-period. Capital expenditure,
research and development costs, etc, are examples of long-term costs.
Short-term costs are costs prepared for a short period of one to two year. They are
prepared for those activities the trend in which cannot be for seen easily over long periods.
These costs are very useful in case of consumer goods industries such as sugar, cotton,
textiles, etc. they are generally prepared in terms of physical units (i.e. quantities) as well as
monetary units (i.e. values) materials cost. Each cost etc, are example of short-term cost.
They are useful to lower level of management for control purpose.
3. CURRENT COSTS:
Current cost is a cost, which is established for use over a short period of time and is
related to current conditions. Thus current costs are essentially short term costs adjusted to
current (i.e., present or prevailing) condition or circumstances. They are prepared for a very
short period. Say, a quarter or a month. They related to current activities of the costs.
4. INTERIM COSTS:
Interim costs are costs, which are prepared in between two cost periods. These costs
may get integrated with the cost of the following period.
Costs in physical terms are cost in terms quantities only. They do not include corresponding
rupee value. Long-term costs are usually prepared in physical terms. Examples of such costs
are production costs, material cost etc…
55
The operating cost for a firm may be constructed in terms of programmers or
responsibility areas, and hence may consist of:
Programmedcost
Responsibility cost
A) PROGRAMME COST:
It consists of expected revenues and costs of various products or projects that are
Termed as the major programmers of the firm, such a cost can be prepared for each
product line or project showing revenues, cost and the relative profitability of the
various in locating areas where efforts may be required to reduce costs and increase
revenues. They are also useful in determining imbalance and inadequacies in
programmers so that corrective action may be taken in future.
B) RESPONSIBILITY COSTS:
2) FINANACIAL COSTS:
Financial costs are concerned with cash receipts and disbursements, working
Capital, financial position and results of business operations. The commonly used financial
costs include cash cost, working capital cost and income statement cost, statement of retained
earnings cost, costed balance sheet or position statement cost.
3) MASTER COSTS:
The master cost is the summary cost incorporating its functional costs.
56
All The operational and financial costs are integrated into the master cost. The cost officer for
the benefit of the top level management prepares this cost. This cost is used to coordinate the
activities of various functional departments. It is also used as an effective control device.
57
OBJECTIVES OF THE COST SYSTEM:
To prepare annual costs in such a manner those managers at various levels in the
organization carry out periodical exercise in respect of each contact or responsibility
center for physical planning and matching resources broke up into monthly targets or
cash flows.
To introduce and operate responsible for achievement of specified targets with the
resources allocated for the purpose.
To bring about effective co-ordination of all activities of the organization of all
activities of the organization and to gear up service divisions to meet effectively the
requirement of projects.
58
QUATERLY REVIEW:
PRT should conduct a quarterly cost review with a view to projecting anticipated
expenditure during the year against approved cost estimates/ revised estimates. As time is
essence of such review, only a quick estimate of anticipated expenditure for individual cost
heads involving provisions exceeding for individual cost heads involving provisions
exceeding Rs 50 lakhs in each case should be made and reported upon in minutes of PRT. For
this purpose, project cost should furnish all the relevant data to general manager (project) and
planning and systems by the 10th of the month following the quarter project cost committee
should review the actual expenditure and assess anticipated expenditure contract co
ordination/engineers in charge the assessments of anticipated expenditure should be furnished
by the project cost committee to general manager (project) by the 30th of the month following
the quarter under review.
CHAPTER-IV
DATA ANALYSIS AND INTERPRETATION
59
60
HERO’s REVENUE COST
1 Sales
61
35000
30000
25000
20000
15000
10000
5000
INTERPRETATION
The data pertaining to the generation and consumption have been obtained from the year
2017-16 and represented in table -1. The aspect included are total generation in (crores Rs)
and utilization for auxiliary consumption respectively.During the year 2017-16 the sales,
fixed costs, variable cost , own Consumption was decreased..Finally with regard to the result
in revenue cost of Hero MotoCorp Ltd totally309.35 % in the year 2017-16 respectively.
62
HERO’s REVENUE COST
1 Sales
63
30000
25000
20000
15000
10000
5000
INTERPRETATION
The data pertaining to the generation and consumption have been obtained from the year
2016-15 and represented in table -1. The aspect included are total generation in (crores Rs)
and utilization for auxiliary consumption respectively.
During the year 2016-15 the sales, fixed costs, variable cost , own Consumption was
decreased. When the estimated costed so sales consumption is 10.28 % respectively.
During the year 2016-15the average intensive are 2657.84 the other Income also 44.63 %
respectively.
Finally with regard to the result in revenue cost of Hero MotoCorp Ltd totally 284.80 % in
the year 2016-15 respectively.
64
HERO’s REVENUE COST
TABLE-I (Rs in corers)
1 Sales
65
30000
25000
20000
15000
10000
5000
INTERPRETATION
The data pertaining to the generation and consumption have been obtained from the year
2015-14 and represented in table -1. The aspect included are total generation in (crores Rs)
and utilization for auxiliary consumption respectively.
During the year 2015-14the sales, fixed costs, variable cost, own Consumption was
decreased. When the estimated coste so sales consumption is 11.91 % respectively.
During the year 2015-14 the average intensive are 2516.56 the other Income also 39.83 %
respectively.
Finally with regard to the result in revenue cost of Hero MotoCorp Ltd totally 284.80 % in
the year 2015-14 respectively.
66
HERO’sREVENUE COST
TABLE-I (Rs in corers)
1 Sales
67
35000
30000
25000
20000
15000
10000
5000
INTERPRETATION
The data pertaining to the generation and consumption havebeen obtained from the year
2011-12 and represented in table -1. The aspect included are total generation in (crores Rs)
and utilization for auxiliary consumption respectively.
During the year 2014-15 the sales, fixed costs, variable cost , own Consumption was
decreased. When the estimated costed so sales consumption is 235.86% respectively.
During the year 2014-15 the average intensive are 45.46% the other Income also 34.74%
respectively.
Finally with regard to the result in revenue cost of Hero MotoCorp Ltd totally284.80 % in
the year 2014-15respectively.
68
HERO’s INDUSTRIES LIMITED
Operational Expenditure Cost for the Year 2013-14
TABLE – I
Rs in corers
AMOUN
AMOUNT RS/MT S/MT
T
1 VARIABLE COST 3698.54 369.85 3368.67 336.86
OPERATIVE
2 392.34 39.23 392.34 39.23
MAINTENANCE COST
3 FINANCE CHARGES
Deprecation 620.54 62.05 539.97 53.99
Interest on fixed capital 298.57 29.85 223.76 22.37
Total of – 3 919.11 91.91 763.73 76.37
GRAND TOTAL (1+2+3) 5009.99 500.99 4524.74 452.47
69
6000
5000
3000
1000
INTERPRETATION
Observed from the above table that the operational expenditure cost of Hero MotoCorp Ltd
in the year 2013-14. Maintenance, employee cost, stationary & general expenses, rebate and
share of other expenses is all are fluctuating with the expenses of the year 2013-14. However
the total operating maintenance costs are 39.23 % increasing respectively.
In finance charges depreciation and interest on fixed capital, has been included
The total finance charges recording increasing of 76.37 % in the year 2013-14 respectively.
The overall costs results of Hero MotoCorp Ltdare earning more profits.
70
HERO’s INDUSTRIES LIMITED
Operational Expenditure Cost for the Year 2013-14
TABLE – I
Rs in corers
71
5000
4500
4000
3500 COSTED ESTIMATED ACTUAL FOR THE YEAR
2013-14 RS/MT
3000
2500
2000
ACTUAL FOR THE YEAR ACTUAL FOR THE YEAR
1500 2013-14 AMOUNT 2013-14 S/MT
1000
500
0
INTERPRETATION
Observed from the above table that the operational expenditure cost of Hero MotoCorp Ltd
in the year 2013-14. Maintenance, employee cost, stationary & general expenses, rebate and
share of other expenses is all are fluctuating with the expenses of the year 2013-14. However
the total operating maintenance costs are 26.74 % increasing respectively.
In finance charges depreciation and interest on fixed capital, has been included
The total finance charges recording increasing of 132.81 % in the year 2013-14 respectively.
The overall costs results of Hero MotoCorp Ltdare earning more profits.
72
HERO’s INDUSTRIES LIMITED
Operational Expenditure Cost for the Year 2012-13
TABLE – I
Rs in corers
73
6000
5000
3000
1000
INTERPRETATION
Observed from the above table that the operational expenditure cost of Hero MotoCorp Ltd
in the year 2012-13. Maintenance, employee cost, stationary & general expenses, rebate and
share of other expenses is all are fluctuating with the expenses of the year 2012-13. However
the total operating maintenance costs are 23.53 % increasing respectively.
In finance charges depreciation and interest on fixed capital, has been included
The total finance charges recording decreasing of 134.53 % in the year 2012-13 respectively.
The overall costs results of Hero MotoCorp Ltdare earning more profits.
74
HERO’s INDUSTRIES LIMITED
Operational Expenditure Cost for the Year 2011-12
TABLE – I
Rs in corers
75
6000
5000
3000
1000
INTERPRETATION
Observed from the above table that the operational expenditure cost of Hero MotoCorp
Ltdin the year 2011-12. Maintenance, employee cost, stationary & general expenses, rebate
and share of other expenses is all are fluctuating with the expenses of the year 2010-11.
However the total operating maintenance costs are 19.39% decreasing respectively.
In finance charges depreciation and interest on fixed capital, has been included
The total finance charges recording decreasing of 124.31 % in the year 2011-12 respectively.
The overall costs results of Hero MotoCorp Ltdare earning more profits.
76
CHAPTER-V
FINDINGS
SUGGESSIONS
CONCLUSIONS
BIBLIOGRAPHY
77
FINDINGS
1. 2017-16 the sales, fixed costs, variable cost , own Consumption was
decreased..Finally with regard to the result in revenue cost of Hero MotoCorp Ltd
totally 309.35 % in the year 2017-16 respectively.
2. Finally with regard to the result in revenue cost of Hero MotoCorp Ltd totally 284.80
% in the year 2016-15 respectively.
3. Finally with regard to the result in revenue cost of Hero MotoCorp Ltd totally 284.80
% in the year 2015-14 respectively.
4. Finally with regard to the result in revenue cost of Hero MotoCorp Ltd totally 284.80
% in the year 2014-15respectively
a. has been included
5. The total finance charges recording increasing of 76.37 % in the year 2013-
14respectively.
a. The overall costs results of Hero MotoCorp Ltd are earning more profits.
b. In finance charges depreciation and interest on fixed capital, has been included
6. The total finance charges recording increasing of 132.81 % in the year 2013-14
respectively.
7. In finance charges depreciation and interest on fixed capital, has been included
8. The total finance charges recording decreasing of 134.53 % in the year 2012-13
respectively.
9. In finance charges depreciation and interest on fixed capital, has been included
10. The total finance charges recording decreasing of 124.31 % in the year 2011-12
respectively.
78
CONCLUSIONS
Every organization has pre-determined set of objectives and goals, but reaching those
objectives and goals only by proper planning and executing of the plans economically.
The Hero MotoCorp Ltdis objectives of planning promoting and organizing an
integrated development of Auto motors Company.
The corporation mission of Hero MotoCorp Ltdis to make available and quality
service in increasingly large quantities, the company will spear head the process of
accelerated development of this sector by expeditiously.
The organization needs the capable personalities as management to lead the
organization successfully, the management makes the plans and implement of these plans are
expressed in terms of cost and cost control.
The Hero MotoCorp Ltdhas cost process in two stages. One is the capital
expenditure cost and another is operating maintenance cost, the capital expenditure cost
shows the list of capital projects selected for investment along with their estimated cost,
operating & maintenance cost refers to the repairs & maintenance costs, the special costs are
rarely used in the organization like long-term costs, research & development cost and cost for
consultancy.
It is to make available and quality work efficient resources and implementation of
sophisticated technology and generation and also creating ambience of collective working of
its employees.
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SUGGESTIONS
Planning has become the primary function of management most of the planning
relates to individual and individual proposals. Costs are nothing but his expressions, largely
in financial terms, cost control has, therefore become and essential tool of management for
controlling and maximizing profits.
The company objectives of the organization and how they can be achieved through
cost control
Time tables for all stages of costing follow
Reports, statements, forms and other record to be maintained
Continuous comparison of actual performance with coasted performance.
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BIBLIOGRAPHY
81