Textile Costing Lecture 08 by imraniqbal

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									                                                                               Textile Costing


                                                            Lecture 8
                                                          CVP in Textiles
Analysis of Spinning, Weaving & Dyeing wrt Contribution Margin & Break Even


 Spinning

 Daily Production for Ne 20/1                      250    Bags

 Monthly Fixed Cost

 Depreciation                             3,500,000
 Financial Charges                        4,500,000
 Admn                                       400,000
 Miscellaneous                            3,000,000
 TOTAL                                   11,400,000

 DAILY                                       380,000

 Profitability Analysis

 Net Cost of raw materials/lb                       35
 Yarn price                                         51    510 per 10 lb

 Contribution                                     16
 Daily Contribution                          400,000

 Profit/(Loss) per day                        20,000
 Profit/(Loss) per month                     600,000


 Weaving

 Daily production per loom                                       500     mtr
  item 20x16/128x60 63"
 Total Looms                                                    120
 Daily prodoction for the unit                               60,000      mtr

 Monthly Fixed Cost

 Depreciation                                           5,600,000
 Financial Charges                                      6,500,000
 Admn                                                     300,000
 Miscellaneous                                          2,000,000
 TOTAL                                                 14,400,000

 DAILY                                                     480,000
 Daily fixed cost per loom                                   4,000

 Profitability Analysis



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                                                                       Textile Costing


Cost of yarn & other materials per meter         50
Price per meter                                  59

Contribution                                     9
Daily Contribution per loom                   4,500

Profit/(Loss) per day per loom                   500
Profit/(Loss) per day                         60,000
Profit/(Loss) per month                    1,800,000


Dyeing

Analysis based on Medium Colors

Production per day                                      50,000   mtr

Monthly Fixed Cost

Depreciation                                      5,600,000
Financial Charges                                 6,500,000
Admn                                                300,000
Miscellaneous                                     2,000,000
TOTAL                                            14,400,000

DAILY                                                  480,000
Fixed Cost per meter                                      9.60

Profitability Analysis - Commission Finishing

Cost of dyes & chemicals                                 5.00
Cost of utilities & misc                                 3.00
Charges per meter                                       20.00

Contribution per meter                                   12.00
Daily Contribution                                     600,000

Profit/(Loss) per day                               120,000
Profit/(Loss) per month                           3,600,000

Find out break even point for this plant




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