Professional Documents
Culture Documents
On
GAS LIGHTERS
:: Prepared by ::
:: Academic Year ::
2015-16
:: Seat No. ::
20
:: Class ::
T.Y.B.B.A.
:: Submitted to ::
Saurashtra University
::Guided by ::
Mr. bupendra chavda
-1-
Projected
Operating Statement
Of
rohit ENTERPRISES
For
3 Years
-2-
Declaration
I undersigned that Sevra rohit the student of T.Y.B.B.A.
hereby declare that the project work in this product project
report is my own work and it has been carried out under the
supervision of Mr. Bhupendra chavda Sir from Savjani
College Veraval.
Place: Veraval.
-3-
Acknowledgement
I am much obliged to express my deep gratitude to all
the personalities who spared their valuable time and gave me
helpful co-operation and proper guidance for my project
report and we know that successful accomplishment of any
work requires co-operation, help, and guidance for many
people through many ways.
Place: Veraval.
-4-
Preface
India is a developing country one of the leading force
behind these outcomes is swift growth of the industry.
Practical studies are the part of B.B.A. course; B.B.A. is a
special course regarding business management. Practical
study implied by saurashtra University. In B.B.A. under this
subject the student requires to visit on one small scale
industry is a pillar of the Indian Economy. Most of business
had been developed as small scale industry. Due to
liberalisation and globalisation where every minute India is
moving a step ahead and expanding it horizontally. And the
competition has to be faced by small scale industry of India
and thus small scale industries are paralyzed.
-5-
index
-6-
20. Interest on Borrowed Capital 38
21. Depreciation 39
22. Annual Cost of Production 40
23. Sales Forecast for 5 years 40
24. Cost Per Unit 41
25. BEP Analysis 43
26. Term Loan Repayment 44
27. Cost of Capital 45
28. Return on Investment (ROI) 45
29. Profitability Analysis 46
30. Risk Factor 48
31. Name & Address of RM Suppliers 49
32. Name & Address of Machinery Suppliers 50
33. Projected Operating Statement 51
34. Projected Balance Sheet 56
35. Projected Cost Sheet For 3 Years 58
36. Particulars of RM Consumed 62
37. Particulars of Finished Goods 62
38. Schedule for Fixed Assets 63
39. Schedule for Factory Overhead 64
40. Schedule for Administrative and Factory Overhead 65
41. Disclosure of significant Accounting Policies 66
-7-
INTRODUCTION
More recently enhancing small scale industries (SSIS) have been viewed as an
effective way of forecasting the private sectors. Contribution to both the growth &
the equity objective of development.
SSIS & cottage industries play a key role in the industrialization of developing
country. This is because they provides immediate large scale employment & have
a comparatively higher labor capital ratio, they need a shorter gestation period &
relatively smaller markets to be economic, they need lower investment, offer a
method of ensuring a market equitable distribution of national income & facilitate
an effective mobilization of resources of capital & skill which might otherwise
remain unutilized & they stimulate the growth of industrial entrepreneurship &
promote a more diffused pattern of ownership & location.
A philosophy that manifests itself in many ways that what is more small scale
enterprise and the core sectors of Indian industrial culture that runs through the
Indian civilization.
-8-
POJECT AT GLANCE
Name of the Unit:-
Rohit Enterprises.
Office Address:-
Rohit Enterprises.
Prahlad Plot Main Road,
Near Patel Diary,
Rajkot.
Location of the Unit:-
Rohit Enterprises.
G.I.D.C. Metoda, Plot No. 2325,
Rajkot.
Type of the Unit:-
Firm
Size of the Unit:-
Small-Scale Industry
Name of the Product:-
Elegant Gas Lighters
Name of Partners:-
Dangar Shailesh L.
Godani Hardik N.
Means of Finance:-
Partners Contribution
Loan from Gondal Nagarik Sahkari Bank
-9-
Market Area:-
Rajkot.
Total Cost of Project:-
Rs. 15, 91,950
Investment in Working Capital:-
Rs. 20, 39,400
Investment in Fixed Assets:-
Rs. 14, 22,000
Return on Investment:-
16.37%
Average Cost of Capital:-
10.98%
- 10 -
MANAGEMENT SETUP
Partner 1st
Contribution:- 50%
Duties &
Responsibilities:- marketing and Finance.
- 11 -
Implementation Of Shedual
Sr. No. Particulars Time Period
1. Preparation of Project Report 4 months
2. Selection of a Site 2 months
3. Registrations of SSI 4 months
4. Availability of Finance 2 months
5. Selection of Machinery 2 months
6. Procurement of Machinery 2 months
7. Recruitment of Labour 15 days
8. Commencing Production 15 days
- 12 -
Organization Structure
Chairman
Manager
Unskilled Workers
- 13 -
Justification Of Proposed Location
Location of any industry is the most important thing behind
Transport Facilities:-
- 14 -
As the project is located at G.I.D.C. Metoda there will not be any
problem in getting transport facilities. As the transport facility is
easily available at our location.
Market Control:-
- 15 -
Product Details
Product:-
These gas lighters are cheap, safe, reliable, and attractive and as
they need no maintenance they have a good chance in the market.
- 16 -
Product Use:-
With the growth the urban population and also the gradual growth
in the living standard of Indian population, the usage of
Electronic gas lighter has increased considerably. Moreover, the
change and liberalization policy of the Indian govt. has made
availability of gas connections very easy. Also the entry of
private Cos, like Super Gas, Gujarat Gas etc., Gas is available at
low charges & in short period of time & as consumption of lighter
depends upon the no. of gas connections there exists a wide
consumption & increasing application of electronic gas lighters.
- 17 -
Market Analysis
The cost of gas lighter is very well within the reach of users
& therefore the demand is increasing day by day. Rajkot
contributes about 60% to 70% of the total all Indias production
of electronic gas lighters. Daily in Rajkot there is about 30,000 to
40,000 units of production of electronic gas lighters.
- 18 -
Raw material
Raw material is a basic need of each & every industrial
unit. This, it is necessary have proper availability of raw material
in proper quantity required and at proper time is an important
factor. The Electronic Gas Lighter requires following materials:
- 19 -
Machineries
Lathe
Fly Press
Drilling Machine
Hand Moulding Machine
Hydrolic Moulding Machine
Testing Panel
Dyes & Jigs fixtures
Power Press Machine
- 20 -
Basis and Presumption
The proposed production of 54,000 per annum of gas
- 21 -
- 22 -
Manufacturing Process
Manufacturing is the core activity. All other activities
- 23 -
Pipe Cutting:-
Pipe Operation:-
Next with the help of dies one opening of the pipe is given
proper shape & on the other opening of the pie, die voram is done
with the help of the machines.
Then according to the pipe whether S.S. or M.S. buff or
crone is done respectively.
- 24 -
Development of Set:-
In this process, the set which is inside the gas lighter is
done. First of all in a piezo cover sparkling pt. will be fitted & on
it aluminium washer is fitted. Again on the washer piezo is put,
then aluminium washer & at last on it, there will be a supporting
M.S. bar. This all will be done in a plastic part.
In one step plastic part first sparking pin is put inside it.
Then the piezo cover which is ready i.e. above is inserted on it in
order to give connection which is seen on the mouth of the gas
lighter. This is one of the main procedures in the manufacturing
of E.G. lighter.
Fitting Material:-
Here, first of all the fitting sets is done & then the Brass
earthing is filled upon the set in order to avoid the shock on the
top part of the gas lighter. This earthing is used to have the
downward how of current & to avoid upward flow of current in
the Electronic Gas lighter. Then on the top part Hammer is fitted
and then handle is fitted. Thus, this is the fitting procedure of
E.G. lighter.
- 25 -
Upper Marks & Stickers:-
Before dispatch the gas lighter stickers & dates one marked
on either pipe or handle. The marking of dates is important
because as the Electronic Gas lighter is a replacement item,
manufacturing time is needed for classifications in case, if needed
thus, the mark of date is marked on the pipe or handle.
Checking:-
This is also very important procedure as the Electronic Gas
lighter is a 100% replacement item. Almost all the manufacturers
give a 6 months to 2 years warranty on their gas lighter. So there
is a fear of replacement if proper checking is not done the
complete assembled. Unit is thus listed for life cycle ignition
before it is sent for packing and dispatch.
Packing:-
- 26 -
Staff and Labour Details
Top Level:-
No. Particulars No. of Rate 1 12
Persons months months
1. Factory 1 10,000 10,000 1,20,000
Manager
Total (A) 10,000 1,20,000
Middle Level:-
No. Particulars No. of Rate 1 12
Persons months months
1. Accountant 2 5000 10,000 1,20,000
2. Clerk 2 3000 6000 72,000
3. Salesman 2 5000 10000 30000
4. Supervisor 1 8000 8000 96000
- 27 -
5. Skilled Workers 6 3000 18000 54000
Total (B) 39000 117000
- 28 -
Bottom Level:-
No. Particulars No. of Rate 1 3 12
Persons months months months
1. Watchman 2 2000 4000 12000 48000
2. Unskilled 3 2500 7500 22500 90000
Workers
Total (C) 11500 34500 138000
- 29 -
Fixed Assets
Fixed Assets:-
Particulars Sq. mt/ Sq. feet Rate Total
Computer 1288 1000 12,88,000
Building 2500 900 22,50,000
Total (A) 35,38,000
- 30 -
Other Assets:-
No. Particulars Total
1. Vehicle 1,80,000
Total (C) 1,80,000
A+B+C
= 35,38,000+15,30,000+1,80,000
= 52,48,000
- 31 -
Cost of Production
Requirements of Raw Material:-
- 32 -
Total Working Capital
- 33 -
Other Expenses:-
Particulars Amount Amount
(per (per annum)
month)
Telephone 406 4,870
Insurance 250 3,000
Stationary 4,917 59,000
Utilities:-
No. Particulars Amount Amount
(per month) (per annum)
1. Electricity 3,000 36,000
Total 3,000 36,000
- 34 -
Total Cost of Production:-
Sources of Finance
No. Particulars Amount (Rs.)
- 35 -
1. Ownership Capital (85%) 46,15,717
2. Borrowed Capital (60%) 8,57,383
Total 54,73,100
- 36 -
Interest on owners capital
Depreciation
- 37 -
Rohit Enterprises is using Straight Line Method for
calculating the depreciation on the fixed assets of the
Sr. No. Particulars 1st year 2nd year 3rd year 4th year 5th year
1 Building 22,50,000 20,25,000 18,22,500 16,40,250 14,76,225
(-) Depreciation @ 10% 2,25,000 2,02,500 1,82,250 1,64,025 1,47,623
20,25,000 18,22,500 16,40,250 14,76,225 13,28,603
2 Plant & Machinery 15,30,000 13,77,000 2,33,500 1,16,750 1,16,750
- 38 -
Annual Cost of Production
1 1,00,000 39 39,00,000
2 1,10,811 37 41,00,000
3 1,15,507 36.5 42,16,000
4 1,22,857 35 43,00,000
5 1,30,882 34 44,50,000
- 39 -
Fixed Cost:-
- 41 -
(a) Profit Volume Ratio:-
= fixed cost + Profit x 100
Sales
= 17,79,000+ x 100
42,02,800
= 51.96%
- 42 -
(c) B.E.P. (Rs.)
= Fixed Expenses
P.V.R.
= 16,15,600
51.96%
= Rs. 31,09,315.
(d) B.E.P.(%)
= F.C. x Utilized capacity
Contribution
= 16,15,600 x90
21,83,930
= 66.58%.
Cost of Capital
Profitability Analysis
Particulars Amt. (Rs.) Amt. (Rs.)
Sales 42,02,800
(-) Cost of production
- 44 -
EBIT 9,09,905
(-) Interest on Capital:
Ownership Capital 3,23,100
Borrowed Capital 1,11,460 4,34,560
EBT 4,75,345
(-) Tax 35% 1,66,370
EAT 3,08,975
- 45 -
Gross Profit Ratio:
- 46 -
Risk Factor
In each & every business activity, there are some hindrances risk,
uncertainties etc. which the Co. has to face and overcome them.
Risk factor means those factors which created hindrances in the
growth of the Co. and also its development. These factors act as
challenges or threats to the Co. for its product. Thus, maximum
care must be taken into consideration by promoting the Co.
(4) It can be possible that all the factors may be suitable for
production & finance but the marketing of our products may not
be enough so there is every possibility of failure or close of unit.
- 47 -
(5) As the product is mainly marketed at the rural and semi
urban areas (Saurashtra & Kutch) there is a chance of lack of
awareness in case of illiterate people who cannot read the
advertisement boards along the roads & so on.
- 48 -
Name & Address of RM Suppliers
Other Materials:-
Lalji Mohan, Ghikata Road, Rajkot.
- 49 -
1 year
Trading A/c
Particulars Amt. (Rs.) Particulars Amt.
(Rs.)
To Opening 0 By Sales 39,00,000
Stock
To Purchase A/c. 17,50,000 By Closing 2,00,000
Stock
To wagws A/c.
Unskilled 2,00,000
- 50 -
1 year
To Net Profit
1,70,640
21,50,000 21,50,000
- 51 -
1 year
Balance sheet
2 year
Trading A/c
- 52 -
Particulars Amt. (Rs.) Particulars Amt.
(Rs.)
To Opening 2,00,000 By Sales 41,00,000
Stock
To Purchase A/c. 18,00,000 By Closing 2,30,000
Stock
To wagws A/c.
Unskilled 2,00,500
43,30,000 43,30,000
2 year
To Stationary 5,500
Dep. On Building 1,17,000
Dep. On machinery 1,35,000
21,29,500 21,29,500
2 year
Balance sheet
3 year
Trading A/c
- 55 -
To Purchase A/c. 18,50,000 By Closing 2,80,000
Stock
To wagws A/c.
Unskilled 2,10,000
44,96,000 44,96,000
3 year
- 56 -
Rent 50000
To Telephone Expense 5,500
To Stationary 5,600
Dep. On Building 1,05,300
Dep. On machinery 1,21,500
Dep. On computer 12,150
int. on capital 2,48,000
Tax(20%) 66,210
To Net Profit
2,64,840
22,06,000 22,06,000
3 year
Balance sheet
Liability Amount NA Assets Amount NA
4 year
Trading A/c
Unskilled 2,20,000
- 58 -
To Gross Profit 22,00,000
46,00,000 46,00,000
4 year
22,00,000 22,00,000
4 year
Balance sheet
Liability Amount NA Assets Amount NA
- 60 -
Total 32,21,500 Total 32,21,500
5 year
Trading A/c
Particulars Amt. Particulars Amt.
(Rs.) (Rs.)
To Opening Stock 3,00,000 By Sales 44,50,000
To Purchase A/c. 19,50,000 By Closing Stock 3,20,000
To wagws A/c.
Unskilled 2,50,000
- 61 -
5 year
22,70,000 22,70,000
- 62 -
5 year
Balance sheet
- 63 -
BEP Analysis
Fixed cost
No. particular Year1 Year2 Year3 Year4 Year5
1 Dep. On 1,30,000 1,17,000 1,05,300 94,770 85,293
building
- 64 -
VARIABLE COST
NO. PARTICULAR YEAR1 YEAR2 YEAR3 YEAR4 YEAR4
1 RAW MATIRAL 17,50,000 18,00,000
- 65 -
Year 1
Cash flow statement
particular Yrar 1
(A)Cash at the beginning of the year
(B) Cash flow from operating activity
- 66 -
Disclosure of significant Accounting
Policies
1) ACCOUNTING POLICIES:
Basis of Accounting:
(3) DEPRECIATION:
(4) INVENTORIES:
- 67 -
(5) TAXATION:
- 68 -