cadburyfinance puja

8/4/2019 CADBURYFINANCE puja

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DECLARATION

I NARESH KUSHWAHA, student of MBA 3 Semester of Jiwaji university,

Gwalior, hereby declare that the project is my original piece of work and not the

copy of any such work undertaken by someone else, all the information , facts and

figures presented in the report are first hand in nature. They are actually based on

my intense efforts conducted in CADBURY INDIA LTD . I have completed this

project under the guidance ofDR. SHWETA SHARMA ( Faculty Jiwaji

university)

Date: NARESH KUSHWAHA

MBA III Sem


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CERTIFICATE

This is to certify thatMr. NARESH KUSHWAHA Student of MBA III Semesterprogramme has completed her summer training of 45 Days and prepared this report

ofMATERIAL COST CONTROL under my guidance .

Date: DR. SHWETA SHARMA

(Faculty Guide)


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ACKNOWLEDGEMENT

The present work is dedicated to the persons who not only taught me, but continue

inspire me in knowing the clandestine facts of workmanship. I bow in honor beforethese great teachers. The accomplishment of the present study became possible by

the invaluable assistance and guidance of my professional guides to whom I may

gratefully indebted. Firstly I would like to express my sincere gratitude to my

faculty guide Prof. SHWETA SHARMA without whose invaluable guidance,

moral support and encouragement my work would have ever assumed the present

shape, research. I were indebted to my parents and friends for their moral support

and possible efforts they made for me.

Date: NARESH KUSHWAHA

MBA III SEM


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INDEX

Company profile

Theoretical aspect of topic

Practical aspect of topic in company

Research methodology

Analysis and graphical presentations

finding

conclusion


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COMPANY PROFILE

CADBURY INDIA

Cadbury began its operations in 1948 by importing chocolates and then re-

packing them before distribution in the Indian market. After 59 years of

existence, it today has five compay-owned manufacturing facilities at Thane,

Induri (Pune) and Malanpur (Gwalior) , Bangalore and Baddi (Himachal

Pradesh) and 4 sales offices (New Delhi, Mumbai, Kolkota and Chennai).

The corporate office is in Mumbai. Our core purpose Working together to

create brands people love captures the spirit of what we are ttrying to

achieve as a business. We collaborate and work as teams to convert products

into brands. Simply put, we spread happiness! Currently Cadbury India

operates in three sectors viz. Chocolate Confectionery, milk food Drinks andin the Candy category.

In the Chocolate Confectionery business, Cadbury has maintained its

undisputed leadership over the years. Some of the key brands are Cadbury

Dairy Milk, 5 Star, Perk, Eclairs and Celebrations. Cadbury enjoys a value

market share of over 70% the highest Cadbury brand share in the world! Our

flagship brand Cadbury Dairy Milk is considered the gold standard forchocolates in India. The pure taste of CDM defines the chocolate taste for the

Indian consumer.

In the Milk food drinks segment our main product is Bournvita the leading

Malted Food Drink (MFD) in the country. Similarly in the medicated candy

category Halls is the undisputed leader. We recently entered the gums

category with the launch of our worldwide dominant bubble gum brand


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Bubbaloo. Bubbaloo is sold in 25 countries worldwide. The Cadbury India

Brand Strategy has received consistent support through simple but

imaginative extensions to product categories and distribution. A good

example of this is the development of Bytes. Crispy wafers filled with cocacream in the form of a bagged snack, Bytes is positioned as The new

concept of sweet snacking. It delivers the taste of chocolate in the form of a

light snack, and thus heralds the entry of Cadbury India into the growing

bagged Snack Market, which has been dominated until now by Salted

Bagged Snack Brands. Bytes was first launched in South India in 2003.

MALANPUR FACTORY

In 1989 the company stated manufacturing operations from its third and

newest factory at Malanpur near Gwalior in M.P.

Using the most modern state of the art technology, the unit todaymanufactures range of liqud milk chocolate and a variety of enrobed

chocolate products.

Factory in 8 phases

1988-89 - Eclairs & Gems

1994-95 - 5 Star


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1997 - Perk

2001 - Chocolate expansion

2005 - Fruity Gems

2006 - Ulta Perk

2008 - Short

2009 - clair Sticks

LOCATION : Plot No. 25, Malanpur Industrial area, Malanpurdistt. Bhind.

Telephone No. : 07539-83803, 83804

Parent Company : Cadbury Schweppes International UK

Total Area 24 Acres Constructed 8.5 Acre

HISTORY OF ORGANISATION

Fifty years ago, the real taste of chocolate as we know it today, landed on

Indian shores. An event that carried forward the entrepreneurship and vision

born as far back as 1824, when John Cadbury set up shop in Birmingham(UK) to sell among other things his own cocoa concoction. From these

modest beginnings emerged Cadbury Schweppes that is today the leading

manufacturer of confectionery and beverages in the United Kingdom. A

company that has its presence in over 200 countries worldwide and has made

the name Cadbury synonymous with cocoa products in countries across the

planet.


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This is the brand that came to India in 1947 to a nation that was in its

infancy, a market that was ready for the world and a people that were open to

new ideas, new products.

Within a year of being set up as a trading concern, Cadbury fry India was

incorporated as a Private Limited company, set up for processing imported

chocolates and Bourn vita. The same year saw the launch of Cadburys Milk

chocolate for millions of Indians.

Through 50 years of investment in capital and marketing, the scale and scope

of our operations has expaned to cover a range of brands in the chocolate,

sugar confectionery and malted food drinks segments. We have a majority

share in the Indian chocolate market and a significant presence in sugar

confectionery and food drinks.

Today Cadbury India Ltd, a subsidiary of Cadbury Schweppes employs over

200 people across the country. And operates in one of the fastest growing

chocolate markets for Cadbury Schweppes group across the globe.


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ORGANISATION STRUCTURE

Chairman

C Y PalChairman -Non Executive

Managing Director

Anand KripaluManaging Director

Non-Executive Directors

Harsh MariwalaRadhakrishnan B. MenonSuresh Talwar

ExecutiveDirectors

Atul Bhatia

Executive Director -

Science & Technology

Rajesh Garg


Finance & Commercial

Jaiboy Phillips

Executive Director - Supply

Chain

Sanjay Purohit

Executie Director - Marketing


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Sunil Sethi


Sales & Customer Development

V Chandramouli


HR & Strategy

Senior Management

Ashish Pisharodi Rajesh RamanathanVice President - Modern Trade Vice President - People & TalentShivanand Sanadi Dr. Shantanu SamantVice President - Legal Affairs

Vice President -

Science & TechnologyVivek Sarbhai Dharmesh JoshiVice President - Logistics &

Customer Operations

Vice President -

Manufacturing Development

Sherezad Irani Sanjay KurupVP - Procurement VP - Manufacturing (Baddi)

Monaz NobleCompany Secretary


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THEORTICAL ASPECT

Finance holds the key to all human activity. Finance department of

malanpur factory is also working in the same direction and with the

same objective but it has some limitation because most of the

importance finance related matter are directly dealt and finalized by the

central finance department in the Mumbai head office.

Factory finance department always endeavors of maximizing the profit

of high company through two possible ways:

1. Reduction in cost

2. Increase in Sales

FINANCIAL FUNCTIONS

1. Preparing variance report

a) Material user variance report

b) Packaging material user variance report

2. Production report

3. Excise related matter

4. Export related matter


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5. Payment to small engineering items and other goods.


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MATERIAL COST CONTRL

MATERIAL COST CONTROL

Material cost control is the management of cost of material it consists of the

following .

1. Capital costs

2. Storage costs3. Risk of price decline

4. Risk of obsolescence

MATERIAL

Material is very important factor for production. it includes physical

commodities used to manufacture the final end product. It is the starting

point from which the first operation starts. Material refers to all of

commodities in the process of manufactures. Proper control of material is

necessary from the time order of purchase material is placed with supplies.

Until the have been consumed.

COST


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It is the amount of resources given up in exchange for some goods or

services. The cost is that which is given or a sacrifice to obtain something

cost is also different from value as cost is measured in terms of money

whereas values is measured in terms of usefulness or utility of an article.

We can define as : the amount of expenditure ( actual or notional ) incurred

on or attributable to a given thing or to ascertain the cost of a given thing.


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Methods of controlling the size of material:

There arc two method of controlling as follows:

1) Standardization.

2) Simplification.

Standardization and simplification are the tools of material control to

optimize on the number of items and reduce the size of material, carried in

the stores.

Standard institutions:

Standardization and simplification are the continuous

process for controlling the size of materials ,so there are many institution

regarding the help of this, these arc as follows

. Indian Standard Institute.

. International Organization for Standardization.

. Other Specialilised Institutions.

Types of stores department:

I) centralized stores

2) Decentralized stores


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3) Central stores with sub- stores.

1) Centralized stores: In case of such a store, material are received by and

issued from one stores department materials kept at one central store.

2) Decentralized stores:

Under this type of stores, independent stores are situated in various

departments. Such types or stores setup to meet the requirements of materials

of each production department are not very popular because of the heavy

expenditure involved.

3) Central stores with sub-stores:

Such stores should be situated near production departments. For each item of

material, a quantity is determined and this should be kept in stock in sub-

store at the beginning ofany period .In the end of a period the storekeeper

ofeach sub-store will requisition from the central stores.


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PRACTICAL ASPECT

Fixation of KO.Q. and various level:

a)E.O.Q.:The decision about how much order has great significance in

inventory management .the quantity should be order neither small nor big

because cost of buying and carrying material are very high.Economic order

quantity is the size ofthe lot to be purchased which is economically ) viable

.this is the quantity of material which can be purchased at minimum costs

.economic order quantity is the point at which inventory carrying cost is

equal to order costs E.O.Q. is made. 01' two parts.

Ordering cost. Carrying cost.

EOQ = 2All

I

Where:A Annual.

B Cost ofplacing an order/. ordering cost or buying cost

PCI' unit

1 Inventory carrying cost ofone unit

C*S(cost per unit*storage cost)

a) Minimum Level or safety stock level:It represent the minimum qty. ofan

item ,which must be keep in store at all time .the main (II' determination of


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minimum level is that ,due to this, production should not be stoped.Calcu1all'

formula of min. stock level is as follows

Minimum level = Re-ordering level-(Normal consumption*Normal Re-order

period)

b) Maximum Level:

It represents the maximum quantity ofan item ofmaterial which can be held

in stock at any time .stock should not exceed this quantity .the quantity is

fixed so that there may bb no overstocking .the formula ofmaximum stock

level given by WHELDON is as follows

Maximum stock level= Reordering level + Re-ordering Quantity-

(Minimum

Consumption*Minimum Reordering period)

c) Average stock level: The average stock level is calculated by the

following formula: Average stock level = Minimum stock level + of re-

order quantity

d) Reordering level :-The order is sent before the materials reach minimum

stock level.Re-order level = Safety stock + (Average usage *Average re=-

order period )

OR

Maximum consumption * Maximum Re-order period

OR

Maximum usage * Maximum lead time


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SAMPLE & TOOLS

1. First in first out (FIFO) method:

Under this method material is first issued from the earliest consignment on

hand and priced at the cost at which that consignment was placed in the

stores .in other words, materials received first arc issued first. the units in the

opening stock of materials are treated as if they are issued (first, the unitsfrom the first purchase issued next and so on until the units left in the closing

stock of materials arc valued at the latest cost of purchases.['his method is

most suitable in times of falling price of materials to jobs or works orders

will he high, while the cost of replacement of materials will be low .but in

case of rising prices this method is not suitable because the issue price of

materials to production will be low ,while the cost of replacement of

materials will be high.

Advantages of FIFO Method: Main advantage of FIFO method is that it is

simple to understand and easy to operate. It is logical method because it takes

into consideration the normal procedure. Of utilizing first those materials

which arc received first .Materials are issued in order of purchases,


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. This method is also useful when transactions arc not too many and price of

materials are fairly steady.

Disadvantages of FIFO method:

. ['his method is increase the possibility of clerical errors, if consignment are

received frequently at fluctuating prices as every time an issue of materials is

made ,the store ledger clerk will have to go through his record to ascertain

the price to be charged.

. For pricing one requisition more than one price has often to be taken.

. When prices rise ,the issue price does reflect the market price as material

are issue from the earliest consignment .therefore the change of production is

low because the cost of replacing the material consumed will be higher than

the price of issue.

2)Last in first out method(LIFO) method:The issues under this method are

priced in the reverse order of purchase i.e., the price of the latest available

consignment is taken. This method is sometimes known as the replacement

cost method because materials are issued at the current cost to jobs or work

orders except when purchases were made long ago. This method is suitable

in times of rising prices because material will be issued from the latest

consignment at a price which is closely related to the current price levels.This method was first introduced in the U.S.A.during the Second World War

to get the advantages of rising prices

Advantages of LIFO Method:

. Like FIFO method, this is simple to operate and is useful when transactions

are not too many and the prices are fairly steady.


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. Like FIFO, this method recovers cost from production because actual cost

of material is charged to production. .

. In times of rising prices, LIFO method of pricing issues is suitable materials

are issued at the current market prices which arc high .this method thus

helps in showing a lower profit because of increased charged to

production during periods of rising prices and lower profit reduces burden

of income-tax..

Disadvantages of LIFO Method

. Like FIFO, comparison between one job and the other job will become

difficult because one job started a few minutes after another of the same

type many bear are different charged of materials consumed.

. Like FIFO, this method many lead to clerical errors as every time as issue is

made. Till...Stored ledger clerk will have to go through the record to as

certain the price to be charge. For pricing a single requisition, more than one

price has often to be adopted. . The stock in hand is valued at price which

does not reflect current market price.

3) AVERAGE COST METHOD: The principle on which the average cost

method is based is that all of the materials in store arc show mixed up that an

issue can not be made from any particular lot of purchases and, there fore, it

is proper if the materials arc issued at the average cost of materials in store.

Average may be of two types:

1) Simple arithmetic

average.

2) Weighted arithmthetics

average.


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1) Simple average price: A price which is calculated by dividing the total of

the prices of the material in the stock from which the material to be period

could be drawn by the number of the prices used in that total.

2) Weighted average price: A price which is calculated by dividing the cost

of materials in the stock from which the materials to be priced could be

drawn by the total quantity of materials in the stock.

Methodology

Every project work is based on certain methodology, which is a way to

systematically solve the problem or attain its objectives. It is a very important

guideline and lead to completion of any project work through observation, data

collection and data analysis.

The word research is derived from the Latin word meaning to know, it is a

systematic and a replicable process which identifies and defines problems, with

specified boundaries. It employs well designed method to collect the data and

analyses the result. A research methodology defines what the activity of research is,how to proceed, how to measure progress, and what constitutes success. A

methodology is a jumbled mess. Different methodologies define distinct schools

which wage religious wars against each other. Research methodology also

considered as a movement, a movement from the known to the unknown. It is

actually a journey of discovery.

According to Clifford Woody,

Research Methodology comprises of defining & redefining problems,

collecting, organizing & evaluating data, making deductions & researching

to conclusions.

Accordingly, the methodology used in the project is as follows: -Defining

the objectives of the study Framing of questionnaire keeping objectives in

mind (considering the objectives) Feedback from the employeesAnalysis offeedback. Conclusion, findings and suggestions.


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Sampling Technique Used:This research has used convenience

sampling technique.

Convenience sampling technique: Convenience sampling is used in

exploratory research where the researcher is interested in getting an

inexpensive approximation of the truth. As the name implies, the sample is

selected because they are convenient

Selection of Sample Size: For the survey of departments.

Sources of Data Collection: Research will be based on two sources:

1. Primary data

2. Secondary data

1) Primary Data:

Survey: Primary data was collected by departmental survey for CADBURY.

2) Secondary Data:

Secondary data will consist of different literatures like books which are published,

articles, internet, the company manuals and websites of company-

www.CADBURY.COM In order to reach relevant conclusion, research work

needed to be designed in a proper way.

This research methodology also includes:-

Familiarization with the concept of finance and its various merits, demerits.

Thorough study of the information collected.

Conclusions based on findings.

Statistical Tools Used
http://www.cadbury.com/http://www.cadbury.com/


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The main statistical tools used for the collection and analyses of data in this project

are:

Pie Charts

Bar Diagrams

Limitations of Study

Financial analysis is a powerful mechanism of determining financial strengths and

weaknesses of a firm but, the analysis is based on the information available in the

financial statements. We has also careful about the impact of price level chances,

windows-dressing of financial statements, changes in accounting policies ofAIRTEL, accounting concepts and conventions, and personal judgments etc.

Due to the following unavoidable and uncontrollable factors the factors, the

result might not be accurate. Some of the problems faced while conducting the

survey are as follows:-

Time and cost constraints were also there.

Chances of some biasness could not be eliminated.

A majority of respondents show lack of cooperation and are biased towards

their own opinions.

Some of the important Limitations of financial analysis are however, summed up as

below:

It is only a study of interim reports.

Financial analysis is based upon only monetary information and non-

monetary factors are ignored.

It does not consider changes in price level.

As the financial statements are prepared on the basis of a going concern, it

does not give exact position. Thus accounting concepts and conventions

cause a serious limitation to financials analysis.

Changes in accounting procedure by a firm may often make financialanalysis misleading.


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Analysis is only a means and not an end in itself. We has to make

interpretation and draw own conclusion

Different people may interpret the same analysis in different ways.

OBJECTIVE OF THE STUDY

The main objective of this study is to carry on brief study on P/rice earnings

Ratio through this I am able to get the difference of various equity share price of

the CADBURY.

Other objectives of this project are as follows:

To identify the various relating amount of the CADBURY with respect to

Annual Reports of the CADBURY

Comparative study of years Annual reports.

To study the various departments for the needs of assets and use-less assets

amount of CADBURY MALANPUR

To understand the information contained in financial statement with a view

to know the strength or weaknesses of the firm and to make forecast about

the future prospects of the firm and thereby enabling the financial analyst to

take different decision regarding the operation of the firm.

Financial ratios are used to compare the risk and return of different firms in order to

help equity investors and creditors make intelligent investment and credit decisions.

Such decisions range from an evaluation of change in performance over time for a

particular investment to a comparison among all firms within a single industry at aspecific point in time. The informational needs and appropriate analytical

techniques used for these investment and credit decisions depend on the decision

makers time horizon. Short-term bank and trade creditors are primarily interested

in the immediate liquidity of the firm. Long-term creditors (e.g., bondholders) are

interested in long-term solvency. Creditors seek to minimize risk and ensure that

resources are available for the payment of interest and principal obligations.Equity

investors are primarily interested in the long-term earning power of the firm. As the

equity investor bears the residual risk (which can be defined as the return from


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operations after all claims from suppliers and creditors have been satisfied), it

requires a return proportionate to the risk. The residual risk is highly volatile and

difficult to quantify, as is the equity investors time horizon. Thus, analysis by the

equity investor needs to be the most comprehensive, and it includes the analysis

carried out by other users.The P/E ratio measures the degree to which the market

capitalizes a firms earnings. The P/E ratio has been the subject of much scrutiny

in the academic as well as the professional world.

RESULTS & DISCUSSION

The P/E ratio is the current stock price of a company divided by its EPS

Variations exist using trailing EPS, forward EPS, or an average of the two

historically, the average P/E ratio in the market has been around 15-25.

Theoretically, a stock's P/E tells us how much investors are willing to pay

per dollar of earnings.

A better interpretation of the P/E ratio is to see it as a reflection of the

market's optimism concerning a firm's growth prospects.

The P/E ratio is a much better indicator of a stock's value than the market

price alone. In general, it's difficult to say whether a particular P/E is high or low

without taking into account growth rates and the industry.

Changes in accounting rules as well as differing EPS calculations can make

analysis difficult.

P/E ratios are generally lower during times of high inflation.

There are many explanations as to why a company has a low P/E.

Don't base any buy or sell decision on the multiple alone.
http://www.investopedia.com/terms/p/price-earningsratio.asphttp://www.investopedia.com/terms/t/trailingeps.asphttp://www.investopedia.com/terms/f/forwardpe.asphttp://www.investopedia.com/terms/i/inflation.asphttp://www.investopedia.com/terms/p/price-earningsratio.asphttp://www.investopedia.com/terms/t/trailingeps.asphttp://www.investopedia.com/terms/f/forwardpe.asphttp://www.investopedia.com/terms/i/inflation.asp


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Analysis and graphical presentation of data

P/E RATIO ANALYSIS

Table for market price of equity share NSC/BSC

Year Market Price of

Equity Share

(NSC)

Market price of

Equity Share

(BSC)

Earning per share

2005-06 308.96 307.14 10.612006-07 512.41 515.13 21.262007-08 880.48 876.09 32.912008-09 531.78 542.21 20.392009-10 476.80 473.89 24.83

YearsNSC BSCHigh Low Average Price High Low Average Price

2009-2010

515.7

1 437.89 476.80

509.7

8 438.01 473.89

2008-2009 542.56 521.00 531.78

856.3

4 789.76 542.21

2007-2008

965.2

0 795.76 880.48

959.3

9 792.79 876.09

2006-2007566.28 458.53 512.41

564.91 465.36 515.13

2005-2006

333.7

8 284.15 308.96

328.5

4 285.74 307.14


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Earning Yield Ratio

Year Earning Yield

Ratio

(NSC)

Earning Yield

Ratio

(BSC)2005-06 29.11 28.942006-07 24.10 24.232007-08 26.75 26.62

2008-09 26.08 26.592009-10 19.20 19.08


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STRENGTH & WEAKNESS

Strengths

Cadbury is the largest global confectionery supplier, with 9.9%

of global market share.

Strong manufacturing competence, established brand name and

leader in innovation.

Advantage that it is totally focused on chocolate,

candy, chewing gum, unique understanding of consumer in

these segments.

Weaknesses

The company is dependent on the confectionery and beverage

market, whereas other competitors e.g. Nestle have a more

diverse product portfolio, where profits can be used to invest in

other areas of the business and R&D.

Other competitors have greater international experience -

Cadbury has traditionally been strong in Europe. New to the US,

possible lack of understanding of the new emerging markets

compared to competitors.


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Suggestions

1. Necessary knowledge and skills about new learning strategies at alllevels;

2. Accreditation of the current teacher training and staff development

programs offered by various providers;

3. A critical mass of local experts to spread the new knowledge and

skills throughout the teachers in the country;

4. Suitable alternative model for in-service training;

5. A plan for national implementation;

Indication of support and commitment by the government


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SPECIAL POINT

Use of Advertising'

No. 1 FMCG Company

Cadbury India has been ranked as the 7th Great Place to Work and the

No. 1 FMCG company in India in 2008, by the Great Place to Work

Institute.

Great Place to Work 2007'

Cadbury India' has been awarded the "Bronze Award for Excellence in

People Management" in the 'Great Place to Work 2007' survey

conducted by Grow Talent Company Limited and Business world. The

award recognizes Cadbury India as a national leader in the

area of Human Resource Management.


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Great Place to Work 2007'

Cadbury India' has been awarded the "Bronze Award for

Excellence in People Management" in the 'Great

Place to Work 2007' survey conducted by Grow

Talent Company Limited and Business world. The award

recognizes Cadbury India as a national leader inthe area of Human Resource Management.

Cadbury India received a bronze award at the Cannes Lions

International Advertising Festival for partnering with a mobile phone

operator in 2005 to provide exam results via SMS to school children.


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Reader's Digest Award recognizes Bournvita

Bournvita won the 'Reader's Digest Trusted Brands' Gold

Award for the vitamin health supplement category in

Indian in 2006. The merit was based on 7000 responses

from questionnaires and telephone interviews across Asia.

Suraksha Puraskar Award 2005

Cadbury India's Bangalore factory has received the "Suraksha

Puraskar" safety award from the National Safety Council - Karnataka

chapter.

ABBY Award wins for India.

The prestigious ABBY awards, held in March, recognise

creative excellence in the Indian Advertising Industry. The Ulta

Perk campaign won four Silver Awards in total and theCadbury Dairy Milk Campaign, Miss Palampur, also


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won a Silver Award. This year Cadbury also sponsored the new'Young ABBY' Award.

Cadbury wins the Effies 2006

At the recent Effie 2006 awards organized by The

Advertising Club of Mumbai, our 'Pappu Pass Ho

Gaya' advertising campaign bagged two more awards

- Gold in the Consumer Products category and Silver in the integrated

advertising campaign category.


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INTRODUCTION

INTRODUCTION of TOPIC

In India we believe that effective communication and availability of

information at the right team and time and right place is critical for an edge in

business. In order to achieve this we realize to importance of and have in

place, an effective IT infrastructure.

Cost accounting isnt just collecting data for history . it is an important tool in

predicting and assuring future profitability . We cant overstress theimportance of our costing tools that provide complete cost estimates at the

time of quotation/order entry based on your latest materials, labor and overhead

costs.

MATERIAL COST CONTROL

Material cost control is the management of cost of material it consists of the

following .

5. Capital costs

6. Storage costs7. Risk of price decline


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8. Risk of obsolescence

MATERIAL

Material is very important factor for production . it includes physicalcommodities used to manufacture the final end product. It is the starting point

from which the first operation start. Material refer to all of commodities in the

process of manufactures . Proper control of material is necessary from the time

order of purchase material are palced with supplies . until the have been

consumed.

COST

It is the amount of resources given up in exchange for some goods or services.The cost is that which is given or a sacrifice to obtain something cost is also

different from value as cost is measured in terms of money whereas values is

measured in terms of usefulness or utility of an article.

We can define as : the amount of expenditure ( actual or notional ) incurred on

or attributable to a given thing or to ascertain the cost of a given thing.


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RESULTS & DISCUSSION

During my research in CADBURY INDIA LTD., MALANUR I

found that MATERIAL COST CONTROL is an integral part of

industrial success.

For purchasing material we should concentrate on the cost of material

through material cost control company can take a top position in

corporate market.

Material cost has played a very important role in economic condition of

company.

After analyzing the data I have reached the conclusion that the

miscellaneous expenditure of the company has reduced which is goodsign and shows the capability of the company in handling wastage,

losses and bad debts.


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DISCUSSION

I have found here these below things from analysis of data.

For economic purchase order of 114 units of MS PIPE. We analysis of

three quotations for choosing lower cost of material. We select the B.D.Raj. & Cos quotation because the lower cost of material. This is the

56185.469 with applying 4% ST & fright.

In store material we found these below things from the store keeping

receipt. Here we show about the two type of material.

ITEM CODE Re-order

level

Max. stock

level

Min. stock

level

Avg. stock

levelCC5801008 1290 1700 540 990CC5801009 2700 3600 900 1500

As such we can get these levels for further items.

For issuing the material we found the knowledge through FIFO and

LIFO method. How material received in store and how should issue it

from the store etc.

During my research period. I have found material cost control

management of the company is very sound thats why their economic

position is also very sound.


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OBJECTIVE OF STUDY

OBJECTIVE OF STUDY

1. To highlight the policies and procedures of Material cost control

2. To make a detailed analysis of the strategies adopted by the companyfor planning and monitoring costs

3. To identify the vertical areas where greater attention is needed for better

management.

4. To find our better plan for company for controlling material.


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SUGGESTION

During my research period I have studied the MATERIAL COST CONTROL

in CADBURY IND. LTD at MALANPUR. On the basis of my study I am

putting some suggestion. Which may certainly improve the efficiency of

material cost control management.

FIFO and LIFO methods should be apply for keeping and issuing the

material in stores.

I suggest through research in this regard to arrive at some suitable mix

of both this method which gives due consideration to value, qualityimportance etc of stock items.

The maximum and minimum level of each item should be indicated to

avoid over-stock or under-stock situation.

Internal performance report an inventory on at least monthly basis

should be prepared to study the material price variance, material usage

and inventory level variance from hr estimate figure.

Material should be purchase at the lower cost but also quality should be

maintains.


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CONCLUSION


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BIBLIOGRAPHY

I concerned the following references in course of my research study

1. Kotari C.R. , Research methodology (Methods & Techniques), Wishwa

Prakashan, 24th Reprint March 1999/

2. CHANDRA PRASANNA, FINANCIAL MANAGEMENT, Tata Megraw-

Hill publishing com. Ltd. New Delhi, Fifth edition 2002.

3. Shukla SM, ACCOUNTING FOR MANAGERS, SAHITYA BHAWAN

PUBLICATION COM. Ltd Raipur.

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