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VALUE ADDITION - PowerPoint PPT Presentation


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VALUE ADDITION. ASSUMPTION ALL OPERATIONS CARRIED OUT IN HOUSE NO TRANSPORTATION COST INVOLVED. RAW MATERIAL COTTON WITH SEED COST Rs. 3200 PER QUINTAL i.e. 100 Kg COST PER Kg Rs. 32 3 Kg COTTON WITH SEED = 1 Kg COTTON WITHOUT SEED COST OF 1 KG GINNED COTTON = 32x3 = Rs. 96

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slide1

VALUE ADDITION

ASSUMPTIONALL OPERATIONS CARRIED OUT IN HOUSE

NO TRANSPORTATION COST INVOLVED

RAW MATERIAL

COTTON WITH SEED COST Rs. 3200 PER QUINTAL i.e. 100 Kg

COST PER Kg Rs. 32

3 Kg COTTON WITH SEED = 1 Kg COTTON WITHOUT SEED

COST OF 1 KG GINNED COTTON = 32x3 = Rs. 96

GINNING

COST OF GINNING = Rs. 1.5 PER Kg

GINNING COST 1.5x3 = Rs. 4.5 PER Kg

COST OF COVERSION OF 1Kg OF GINNED COTTON TO 1 Kg ROVING = Rs. 30

slide2

COST OF CONVERSION OF 1 Kg ROVING INTO 1 Kg YARN = Rs. 60

(30 HANKS OF 30s COUNT IN 1 Kg. Rs. 2 PER HANK SPINNING WAGES)

TOTAL COST OF CONVERSION OF 1 KG YARN

COST OF GINNED COTTON + GINNING COST + ROVING CONVERSION COST + YARN CONVERSION COST

Rs. 96 + 4.5 + 30 + 60 = 190.5 i.e Rs. 190

YARN SELLING COST Rs. 240 PER Kg.

PROFIT ON 1 Kg YARN Rs. 240 – 190 = Rs. 50

THIS MEANS PROFIT ON 3 Kg UNGINNED COTTON = Rs. 50

PROFIT ON 1 Kg UNGINNED COTTON = 50/3 = Rs. 16

SALE PRICE OF UNGINNED COTTON 32 + 16 = Rs. 48

COST OF 1 QUINTAL COTTON INCREASE TO 48x100 = Rs. 4800

slide3

CONVERSION OF YARN TO GREY FABRIC

FROM 1 KG YARN IT IS POSSIBLE TO WEAVE 8 METERS OF GREY FABRIC

WEAVING CHARGES = Rs. 10 PER METER

CHARGES FOR WEAVING 8 METER FABRIC 10x8 = Rs.80

SELLING COST OF GREY FABRIC Rs. 50 PER METER

TOTAL COST OF FABRIC 8x50 = Rs 400

PROFIT ON 8 METER FABRIC

SELLING COST OF GREY FABRIC – (YARN CONVERSION COST + FABRIC CONVERSION COST) = 400 – (190+80) = Rs. 130

PROFIT ON 3 Kg UNGINNED COTTON = Rs.130

PROFIT ON 1 Kg UNGINNED COTTON = 130/3 = 43

SALE PRICE OF 1Kg COTTON AFTER CONVERSION TO GREY FABRIC 32 + 43 = 75

SALE PRICE OF 1 QUINTAL COTTON 75x100 = 7500

slide4

CONVERSION OF GREY FABRIC TO FINISHED WHITE FABRIC

COST OF DESIZING, SCOURING AND BLEACHING Rs. 5 PER METER

TOTAL PROCESSING COST 8x5 = Rs. 40

SELLING PRICE OF WHITE FINISHED FABRIC = Rs. 70 PER METER

PRICE OF 8 METERS WHITE FABRIC 70x8 = Rs. 560

PROFIT ON WHITE FABRIC 560 – 40 = Rs. 520

COST OF 3 Kg UNGINNED COTTON = Rs. 520

COST OF 1 Kg UNGINNED COTTON 520/3 = Rs. 173

SELL PRICE OF 1 Kg UNGINNED COTTON 32 + 173 = Rs. 205

SELL PRICE OF 1 QUINTAL COTTON = Rs. 20,500

slide5

CONVERSION OF WHITE FABRIC TO GARMENTS

FROM 8 METERS FABRIC ONE CAN STITCH 4 HALF SHIRTS

STITCHING CHARGES Rs. 70 PER GARMENT

STITCHING CHARGES OF 4 GARMENTS = 4x60 = Rs. 240

SELLING PRICE OF EACH GARMENT Rs. 225

TOTAL SELLING PRICE 225x4 = Rs. 900

PROFIT ON 4 GARMENTS 900 – 240 = Rs. 660

PRICE OF 3 Kg. UNGINNED COTTON INCREASED TO RS. 660

PRICE OF 1 Kg UNGINNED COTTON 660/3 = Rs. 220

SELL PRICE OF 1 Kg. COTTON BECOMES 32 + 220 = Rs. 252

SELL PRICE OF 1 QUINTAL COTTON 252x100 = Rs. 25200

slide6

PRICE APPRECIATION SUMMARY

SELLING PRICE PER QUINTAL (Rs.)

RAW COTTON 3200

YARN 4800

GREY FABRIC 7500

WHITE FABRIC 20,500

GARMENT 25,200