MANAGEMENT ACCOUNTING

FINAL ASSESSMENT

Full Name: Dinh Thi Hong Han

Student number ID: BCU0309

Lecturer’s Name: Mrs. Ngoc Anh

Module: Management Accounting

Submission Date: 17/04/2022

Word Count: 1119

Signed: Dinh Thi Hong Han

Table of Contents
1. Elevator Pitch...............................................................................................................2
2. Market overview........................................................................................................... 3
2.1 Targeted Customer....................................................................................................3
2.2 Market size................................................................................................................ 3
2.3 Trends....................................................................................................................... 3
2.4 Overview economy of Vietnam.................................................................................3
3. About the Product........................................................................................................4
3.1. Materials and Pricing...............................................................................................4
3.2 Direct materials budgeted..........................................................................................4
3.3 Direct labors budgeted..............................................................................................4
3.4 Equipment.................................................................................................................4
3.5 Expense Classification & Break-even.......................................................................5
3.6 Realistic of this project.................................................................................................5
4. Conclusion....................................................................................................................5
5. References..................................................................................................................... 5
6. Appendices.................................................................................................................... 6
Competitors................................................................................................................... 6
Direct material..............................................................................................................7
Equipment.....................................................................................................................8
Expense Classifications.................................................................................................9
1. Elevator Pitch
Matcha powder is becoming a favorite ingredient in beautifying, F&B industries all over
the world. It is not irrefutable that Japan which country has special tea culture is the
origin of this kind of powder. Vietnam has been importing progressively a large quantity
of matcha powder from other nations such as Japan, Taiwan, ... every year. The price is
quiet high owning to the importing fee. In fact, in Vietnam, Thai Nguyen province is
well-known about growing tea leaf industry. Thus, this is a feasible opportunity to
produce the matcha powder made from Vietnam’s tea leaf that can effectively deduct the
price and create the potential domestic market for this ingredient.

2. Market overview
2.1 Targeted Customer
Our company determine the targeted clients such as restaurants, milktea shop, coffee
shop, baking vendor, food and bevarage enterprise, beauty spas, and residents who ages
more than 5 in Vietnam market (focus on larger city as HCM city, Da Nang, Ha Noi).
2.2 Market size
According to the information from Statista, the quantity of
existent coffee outlets in Vietnam has been over 1,100 of
the period of 2019 to 2021. Moreover, in Vietnam 2019,
based on the statistic of (Nhân, 2019), there were 1500
bubble tea stores with over 100 distinct brands that is
claimed as a “gold mine” in the F&B industry. Besides,
24h, 2021 argued that the beauty spas remains the
increasing number in recent years. This is obviously a potential target market to improve
the matcha powder product.

2.3 Trends
In recent years, matcha has been becoming the trend of
young generation in Vietnam because of its taste, and
uses. Admittedly, Vietnam people nowadays tend to the
healthier and sustainable lifestyle by using foods
containing plentiful nutritions (Nam & Economy, 2021).
Besides the masive consumption demand, matcha can be
incorporated with various different ingredients; therefore,
bakers or drink stores are enthalling this powder.
2.4 Overview economy of Vietnam
Unlike coffee which remains a intensive competition of manifold enterprises, matcha
manufacturing still a new segment with a small number of firm in Vietnam. Almost the
existent matcha powder that are selling is imported from other nations. If we penetrate at
this time, we obviously have a opportunity to domain this market share. To illustrate, few
years ago, young Vietnamese started to make and then trade the matcha with his
instrinsic research; at a result, he could construct sturdy business with the revenue rate up
to billions VND per month (Mai, 2018). Furthermore, according to (Journal, 2017),
period from 2016-2025, the global matcha market is estimated 2,6 billion USD and
predicted Compounded Annual Growth rate has been up to 7.6%. However, producing
 matcha powder also emerges obstacles as technology issue, lack management, brand
consumers’ identifying.
Competitiors: With the gathered information, main rivals are Bona Matcha (PL, TCH),
Trivie, IsokomaNori, Matchi, ...

3. About the Product

3.1. Materials and Pricing
Needed materials to make Quantity Cost per unit Selling price Profit
1 unit ( 500g/ unit)
Tea leaf 5000g 175,000 VND
Food adjunct 0.005g 10 VND
Packaging 1 pack 190 VND 374,800 VND (2.14)
Total 175,200 VND 550,000 VND
The useful life of this project is 4 years (2022-2025). In 2013, 1 kilogram of matcha was
750,000 – 1,000,000 VND (Dung, 2018). The price of matcha is 1,000,000 – 3,000,000
VND in 2022 depend on the quality (matchashop.vn). We want to produce matcha
powder made from Vietnam with the affordable price; so, the price is 550,000 VND/
product. Our COGSs are evaluated relied on direct material because the main product
capital is tea leaf, and the overhead cost is quiet dificult to allocate to each product.
3.2 Direct materials budgeted
2022 2023 2024 2025
Production 24,000 25,800 27,800 29,900
Material per unit (kilograms) 5 5 5 5
Production needed 120,000 129,000 139,000 149,500
Add: Desired ending inventory 12,900 13,900 14,950 16,100
Total needed 122,900 142,900 153,950 165,500
Less: Beginning inventory 0 12,900 13,900 14,950
Material to purchase 122,900 155,800 167,850 180,450

3.3 Direct labors budgeted

2022 2023 2024 2025
Units of production (500g/unit) 24,000 25,800 27,800 29,900
Direct labor per unit (hour) 0.12 0.12 0.12 0.12
Labor hours required 2880 3096 3336 3588
Hourly wage rate (VND) 32,500 34,775 37,209 39,813
Total direct labor cost 93,600,000 ~107,800,000 ~124,100,00 ~142,800,000
0
The production volume is based on the actual revenue of the rival enterprises. The
successful business mentioned in (Dung, 2018) reported that their sale volume per month
was from 1-2 ton. Besides, 1 product costs merely 3 minutes. The time is evaluated relied
on the efficiency of equipment per day. According to (Kiều, 2022), salaries of employees
should be increased 5-7% as expose to the standard salaries 2020-2021, so the wage rates
accelerate 7% through the following years.
 3.4 Equipment
Equipment Num Selling Price Total Useful Depreciation
ber life (1 year)
Conveyor belt 1 46,000,000 46,000,000 4 years 11,500,000
Nano mill 1 26,500,000 26,500,000 4 years 6,625,000
Vibrating screen machine 1 74,000,000 74,000,000 4 years 18,500,000
Centrifuge 1 192,500,000 192,500,00 4 years 48,125,000
0
Packing machine 1 46,000,000 46,000,000 4 years 11,500,000
Storage cabinet 1 41,300,000 41,300,000 4 years 10,325,000

3.5 Expense Classification & Break-even

Variable Expense (4 years) Fixed Expense (4 years)
Amount (1000vnd) Amount (1000vnd)
Direct material 109,850 Advertising 2,956,250
Direct labor 468,300 Factory rent payment 720,000
Total Variable Expense 578,150 Manager’s salaries 374,400
Administrative expense 5,912,000
Depreciation 426,300
Technology transfer 100,000
Total Fixed expense ~10,489,000

(1,000vnd) Per unit Break-even in unit = Margin of safety (units)

Sales 550 10,489,000/539,240 ((53,944-19,451)/53,944))x100
= ~19,451 (units) =63.94%
Variable expense ~10.76 Unit sales to attain target
Contrubution 539.24 profit =
margin (20,000,000+10,489,000)/539.24
Fixed expense ~190.32 = 53,944 units

3.6 Realistic of this project

In this project, all the colleted data about the price is just for reference only because the
actual price of materials, equipment ... are not published. These prices would be different
among suppliers. Besides, there is a shortage of relevant information about competitors,
process of producing matcha, exact consumption as matcha is still a new manufacturing
industry in Vietnam. However, relied on the MOS rate above (63.94%), the risk of this
project is quiet low to invest in. The high MOS rate can effective reduce the risk and
error in the business. In addition, with the high forecasted demand of matcha powder, this
project may be the potential chance to generate target profit.

4. Conclusion
In short, besides disadvantage aspects, the potential merits of our project are also
interpreted clearly above. This project may not be a perfect planning but it still has
appropriation with the current market, necessary demands, trends in Vietnam economy to
operate a successful manufacturing process through computed data, and various
secondary articles from the Internet. Producing Matcha project is able to applied in actual
in the future.

5. References
24h, S. khoẻ. (2021, July 20). Ngành thẩm mỹ và làm đẹp tại Việt Nam đã “chuyển dịch”
như thế nào? https://antoanyte.vn/355-nganh-tham-my-va-lam-dep-tai-viet-nam-
chuyen-dich-nhu-the-nao-d2883.html
4 cách ước lượng chi phí chạy quảng cáo phù hợp cho doanh nghiệp. (2019).
https://adsplus.vn/4-cach-uoc-luong-chi-phi-chay-quang-cao-phu-hop-cho-doanh-
nghiep/
Batdongsan. (2022).
https://batdongsan.com.vn/cho-thue-kho-nha-xuong-dat-quan-12/cho-trung-tam-q12-
vung-lan-can-gia-tot-lh-0918-83-55-47-pr17467273
Dung, H. (2018, April 2). Chế cối đá nghiền trà xanh: 9X Thái Nguyên kiếm tiền tỷ.
https://vietnamnet.vn/che-coi-da-nghien-tra-xanh-9x-thai-nguyen-kiem-tien-ty-
437530.html
Journal, A. F. (2017, October 11). QUY MÔ THỊ TRƯỜNG MATCHA DỰ BÁO ĐẠT
5,07 TỶ USD ĐẾN NĂM 2025. http://agro.gov.vn/vn/tID25191_Quy-mo-thi-truong-
matcha-du-bao-dat-507-ty-USD-den-nam-2025.html
Kiều, H. (2022, January 29). Tăng lương tối thiểu năm 2022: Liệu có còn lỗi hẹn sau 2
năm chờ đợi? https://www.vietnamplus.vn/tang-luong-toi-thieu-nam-2022-lieu-co-
con-loi-hen-sau-2-nam-cho-doi/770581.vnp
Mai, C. (2018, April 28). Making matcha, Vietnamese youth earn billions of VND.
http://english.vietnamnet.vn/fms/business/199504/making-matcha--vietnamese-
youth-earn-billions-of-vnd.html
Nam, V., & Economy, N. (2021). Vietnamese adopts healthier , sustainable lifestyle
choices : report. 8–10.
Nhân, T. (2019, April 3). Trà sữa đang là “mỏ vàng.” https://www.vietdata.vn/tra-sua-
dang-la-mo-vang283412755#:~:text=Cả nước có khoảng 1.500,vừa gia nhập thị
trường
 6. Appendices
Competitors

Partner of

Bona Matcha currently is

Source:
Souce: the main partner of 2 https://inter-fair.com/Announcement/
https://www.facebook.
com/BonaMatcha/ famous coffee chain in Announcement?
Viet Nam, including strPath=ISOKOMANORI
Phuc Long, and The Coffee House.

Direct material

The process of manufacturing matcha powder

from another firm :
https://www.youtube.com/watch?v=rW2ANDz36Cg

Images of materials needed:

Source: Source: Source:

https://www.matchawellness.com.au/ https://luankha.com/chat-dieu-vi/ http://surl.li/bshjd
blogs/matcha-education/matcha-
production-process-how-matcha-is-made

Equipment Illustrated image Selling Price Link for Note

(Source) (VND) purchasing
Conveyor belt 46,500,000 VND http://surl.li/ This price is just an estimated
brqbw
price as the general prices are
not public. In actual, the price
for this machine can be adjusted
by other suppliers

Nano mill 26,500,000 VND http://surl.li/ This price is just an estimated

brqcn
price as the general prices are
not public. In actual, the price
for this machine can be adjusted
by other suppliers

Vibrating 74,000,000 VND http://surl.li/ This price is just an estimated

brqcx
screen price as the general prices are
machine not public. In actual, the price
for this machine can be adjusted
by other suppliers

Centrifuge 192,500,000 http://surl.li/ This price is just an estimated

VND brqdp
price as the general prices are
not public. In actual, the price
for this machine can be adjusted
by other suppliers

Packing 46,000,000 VND http://surl.li/ This price is just an estimated

brqdz
machine price as the general prices are
not public. In actual, the price
for this machine can be adjusted
by other suppliers

Storage 41,300,000 VND http://surl.li/ This price is just an estimated

brqeb
cabinet price as the general prices are
not public. In actual, the price
for this machine can be adjusted
by other suppliers

Equipment

Expense Classifications
Fixed Expense:

- Advertising fee in 4 years: The bugeted rate for advertising should be 5% of total
expected sale revenue = (550,000 x 107,500) x 5% = 2,956,250,000 (VND)
According to (4 Cách Ước Lượng Chi Phí Chạy Quảng Cáo Phù Hợp Cho Doanh
Nghiệp, 2019), the budgeted rate for advertising should be from 2-20% depend on the
competition on the market. Therefore, with the current market competition is not
intensive, the advertisng budget is equal 5% of total expected sale revenue.

- Factory Rent payment : The expenditure for factory renting is estimated merely 15
million per month. This price base on the real easte for lease website Batdongsan, 2022.
Total rent payment = 15,000,000 x 12 x 4 = 720,000,000 VND

- Administration expense: The administration expense is estimated 10% of the total

revenue = (550,000 x 107,500) x 10% = 5,912,500,000 VND

- Depreciation in 4 years = total equipment = (46 +26.5+74+192.5+46+41.3) x

1,000,000 = 426,300,000 VND

Variable Expense

- Direct Material in 4 years = (122,900+155,800+167,850+180,450) x 175,200 =

109,850,000
- Direct Labor in 4 years = 93,600,000+107,800,000+124,100,000+142,800,000 =
468,300,000 VND

Target Profit in units

- Target profit: is 20 billion VND in this project that can cover the interest of bank loan.
Assume that the initial capital (11 billion) is lent from the bank in 4 years with the
interest rate is 7.6%/ year.
The interest payment in the
project’s useful life is
3,344,000,000 VND.

Source Lending Interest

Rate
:https://data.worldbank.org/indicator/FR.I
NR.LEND?locations=VN