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Lilac Flour Mills

Managerial Accounting and Control - II

Instructor: Prof. Keyur Thaker

Group 4a
Edukondalu N
Amit Pant
Aditya Jain
Lokeswara Reddy T
Deepesh Dadlani

Case Brief About the Firm The Problem Current Accounting Procedure Advised Accounting Methods  .

Lilac Flour Mills – Flow Chart Cleaning Milling Roller Mills Chaff Removal Brushing First Break Second Third Fourth Dust Break Triuor Break Break Removal Equipment Sieving Wheat Corn Sieving Bin Washing Sieving Sieving Plant Sifters White Suji Wholemea Bran Flour l Flour .

880 Suji 90 1.000 21.928 2.000 116 10.140 (726) (1.850 78 1.440 Bran 180 3.66.866 1.100 172 92.000 1.850 84 1.Method used now – Physical Quantities Method Lilac Flour Mills Calculation of average unit product costs (on the basis of production quantities) Monthly wheat input = 900 tons Product Producti Joint costs Joint cost Separable Total Sales price Profit per Profit for on in allocated on per ton costs per ton cost per per ton ton total tons the basis of ton output production quantities White Flour 540 9.000 1.500 1.780 .33.680) 900 16.884 2.850 16 1.850 34 1.934 2.480 546 49.65.66.500 1.30.99.140 Wholemeal flour 90 1.

626 2.000 21.355 2.80.000 Bran 180 1.23.83.004 1.65.42.085 1.780 17.000 Suji 90 2.13.200 Wholemeal flour 90 2. Proposed Method – I Sales Value Method Lilac Flour Mills Calculation of average unit product costs (on the basis of sales value) Monthly wheat input = 900 tons Product Productio Sales Sales Joint costs Joint Separable Total cost Profit Profit for n in tons price per Value allocated on cost per costs per per ton per ton total ton the basis of ton ton output sales value White flour 540 2.72.400 .100 10.000 1.454 26 2.34.936 1.140 1.200 900 16.945 55 4.911 34 1.235 2.480 2.105 35 6.089 16 1.05.254 11.007 78 2.285 2.96.085 15 8.370 84 2.

74.100 11.77.15.34.400 16.65.940 1.784 2. Net Realizable Value Method Lilac Flour Mills Calculation of average unit product costs (on the basis of net realizable value) Product Produc Sales Sales Separa Separa Net Joint Joint Separ Total Profi Profit for tion in price per Value ble ble Realizabl costs cost able cost per t per total tons ton costs Costs e Value allocated per ton costs ton ton output per ton at splitoff on the per point basis of ton net realizable value White flour 540 2.000 1.655 Bran 180 1.099 Suji 90 2.76.140 2.365 84 2.12.708 900 17.200 16 2.780 16.109 16 1.074 26 10.060 1.320 1.200 84 7.05.80.99.781 14.91.880 2.996 78 2.120 10.560 2.02.42.612 1.000 78 42.856 Wholemeal 90 2.000 34 3.23.780 .480 2.86.640 2.000 21.285 flour 1.880 1.449 31 2.941 34 1.125 15 2.975 25 2.

000 0 0 Bran 180 1.480 0 0 Wholemeal flour 90 2.940 1.70.100 1.982 78 2.42.320 1.200 2.140 0 0 900 17.640 2.000 1.480 2.15.000 21.140 2.05.000 10.000 1.966 34 2.060 40 21.76.200 2. Assuming Three By-Products Lilac Flour Mills Calculation of average unit product costs (on the basis of 3 by-products) Monthly wheat input = 900 tons Product Producti Sales Sales Value Joint costs Joint Separable Total cost Profit Profit for on in price per allocated on cost per costs per per ton per ton total tons ton the basis of 3 ton ton output by-products White flour 540 2.65.780 Suji 90 2.34.02.23.780 .80.396 84 2.400 16.124 16 1.100 11.

854 Suji 90 2.100 11.140 2.444 36 3.360 84 2.666 Bran 180 1.79.05.200 2.000 10.274 1.780 .998 78 2.71.42.903 34 1.076 24 12.02.400 16.000 21.480 2. Assuming Barn as By-Product Lilac Flour Mills Calculation of average unit product costs (on the basis of bran as a by-product) Monthly wheat input = 900 tons Product Producti Sales Sales Value Joint costs Joint cost Separable Total cost Profit Profit for on in price per allocated on per ton costs per per ton per ton total tons ton the basis of ton output bran as a by- product White Flour 540 2.140 0 0 900 17.260 Wholemeal flour 90 2.026 1.320 1.34.12.23.124 16 1.200 2.380 2.937 63 5.65.80.000 1.000 1.

3% 2.7% 3.0% 1.928 8.9% 2.884 5.140 0.444 1.105 1.3% 1.480 1.454 2.125 .074 Suji 2.866 -63.1% 1.000 1.7% 1.7% 1. Summary of all Methods Sales Production Value Method Sales Value Method Net Realizable value Assuming 3 By-products Assuming Bran as By- Price per product Ton Total Cost Gross Total Cost Gross Total Cost Gross Total Cost Gross Total Cost Gross (Inventory Margin (Inventory Margin (Inventory Margin (Inventory Margin (Inventory Margin Value) per Value ) per Value ) per Value ) per Value ) per ton ton ton ton ton White Flour 2.480 0.085 2.934 22.449 Wholemeal 2.975 Bran 1.1% flour 1.0% 2.2% 0.2% 2.140 0.000 0.076 1.2% 2.0% 1.945 1.140 1.1% 2.0% 1.937 3.8% 2.0% 1.0% 1.100 1.060 1.5% 2.