Issues under Consideration

Firm had suffered a loss of 30 million rupess

Not happy with the cost control measures used
Not liked the efforts made by some of the managerial personnel
Any difference among costs, expenses, prices and losses
Jassi suggestion ascertain the costs accurately
Not sure about various costs should be added to the invoice price
Juggu and Mukku's salaries and operational costs related to lotion
MGPM would be able to reduce the warranty repair costs by 99.5% if purchased from ME
Electricity bill increased continuously during the last three quarters
Increased production of different items would not be sold during the current quarter
Salary of the new supervisor to the additional units produced by workers to calculate their inventorial costs
Using personal money in case of emergency
Dropping some of the unprofitable products to increase the overall profit margin
Gopal suggestion to save about 20% of the cost
Instead of completing all the activities relating to product, each craftsman can specialize in particular activity
Firm's opportunity to express interest to supply some premium items to Cottage Emporium
Initially, some issues relating to cost control appeared to be very trivial, but he realized these are complex.
Should he change the management team?
Should he enter into a contract with T M Chemicals?
In case the firm does not appear to be profitable, should he dispose it off and explore the other possibilites?
Should he drop the production of jewelry boxes?
Should he go for redesign proposal given by craftsman?
Would it be worthwile to supply the items to cottage emporiums?
Desired Information Available Information
Actually firm will generate profits as p Profits are expected but very high losses occurred
He assumed everything is fine and expeIt is due to lack of prper cost control measure
He assumed they are efficient Due to managerial team he thought it occurred
He should be in a position to aware of aHe is unable to differentiate between the costs, e
Company is seeing one effective approac Jassi suggested effective cost measuring methods
Company should aware what should beCompany i was not sure whether various costs need t
Company shouls start get delivery of l Juugu & Mukku working on production of lotion an
Reduce warranty repair costs Firm would reduce the warranty repair costs by 99
It will be good thing electricity bills Electricity bills are incresed continuously from last
It will be good the produced items shouNewly produced products are not sold in the same
Leveraging the salary of new supervisorCompansating the salry of supervisor with the inven
Generally company should have reserveUsing personal money in case of emergency
It is desirable approach as per the info Removing unprofitable products from the producti
Highly appreciated if these measures Gopal suggested cost saving measures
Instead of completing all the activities Each craftsman specialize in particular activity
Joginder's broad concept of cost to ear Firm's opportunity to express interest to supply
It will be desirable if cost control meas Initially, some issues relating to cost control appea
Due to efficient management team his fHe is thinking to change the management team
Due to this contract the firm is going t He is thinking to enter a contract with T M chemica
Though company facing losses it shouldJoginder's thoughts on disposing
It will reduce the unnecessary costs Company thinking to drop the production of jewelr
Redesign proposal will decrease the u Should he go forredesign proposal given by crafts
After agreement with cottage emporiums He is thinking whether to go for agrrement or not?
Gap Possible source of Information
On what basis he expected profits?Income Statement
Proper cost control measures Income Statement
Lack of efficiency He need to check in the company
As a company head he should haveIncome Statement and Balace sheet
As a firm they didn't applied in tha From Jassi
Confused in what costs need to addCosts manager
That particular machine don't haveDepends on his thought process how he look at that particular machine which don't hav
But the machines cost are high Depends on managerial decesions
Due to manufacturing of variety ofIncome statement
Due to production of different itemBalance sheet and production manager
NA Observation
And he will loose the opportunity tCosts manager
Company should made through analy Income statement
How efficiently it work Observing the suggested operations cost implications
Earlier all craftsman are doing all acFloor level production
Cottage emporiums may insist on pa As per the agrrement
Initially some issue are seen as tri Entire cost control measures
Due to not effective cost measure it lead to losses
NA Based on discussions between parties
NA Due to losses of the company
Unnecessary costs Based on implications if he decided to not to manufacture jewelery items
Unnecessary costs Based on the his actions on this
NA Depend on agrrement between the parties
machine which don't have other use