This is a Cost Accounting presentation of String Bag from Bangladeshi perspective.

1. WELCOME TO THE PRESENTATION
COURSE CODE: ACT 333
SECTION: 01
PRESENTED TO:
AFRIN RIFAT
LECTURER
SCHOOL OF BUSINESS
PRODUCT NAME: STRING BAG

2. GROUP NAME: VERTEX
PRESENTED BY:
Name Id
Boktiar
Forhad
Ratul
Ahnaf Sadat Ahmed 1220047030

3. INTRODUCTION
 It is our great opportunity to learn about managerial accounting
and implement the concepts on a product.
 Our product is string bag
 Our main objective is to provide best quality products at a cheap
price.

 We choose this product for three reason: 1.High market demand
 2. low labor cost
 3.High profit margin

4. PRODUCT: STRING BAG

5. INDUSTRY CONDITION OF STRING BAG
AND COMPETITION OF THIS PRODUCT
 At present, condition of the string bag industry is very good
 Competition is very high
 Local unknown brand charge: 80 -100 taka per bag
 Imported this type of bag from china charges: 150-200 taka per
bag
 Branded product like Adidas and Nike charge: 500-1500 taka per
bag

6. MANUFACTURING PROCESS:
Our business is a manufacture
based one
We purchase materials and other
necessary items from suppliers and
we convert these materials to make
our final finished product.

7. PRODUCT DETAILS :
Product Name String bag
Fabric Polyester, Nylon.
Weight 50-70 gm.
Dimension Length-20 inch Width-
12 inch
Color Bag- Black & Navy Blue
Price BDT 120.

8. BUDGETED INCOME STATEMENT:
(CONTRIBUTION FORMAT)
Details Amount (BDT)/Unit Amount (BDT)- Total
Sales 120 66000
(-) Total Variable Cost 71.375 39256.25
=Contribution Margin 48.625 26743.75
(-) Total Fixed Cost - 12675
Operating Income 14069
We have assumed that we will Manufacture 605 bags as per
Production Budget and Sell 550 bags as per Sales Budget.
CM Percentage= CM/Sales = 26743.75/66000=40.52%

9. BREAK-EVEN POINT:
UNIT Sales:
=Fixed Cost/ Unit CM Per
Bag
=Tk. 12675/Tk. 48.625
=261 Units
BDT Sales
=BEP Units*Unit Selling
Price
=261 Units *Tk. 120
=Tk. 31320

10. MARGIN OF SAFETY:
Margin of Safety
=Sales- BE Revenue
=66000-31320
=BDT 34680
Margin of Safety Percentage: 52.54%

11. OPERATING LEVERAGE
Degree of Operating Leverage
=Contribution Margin/ Operating Income
=26743.75/14069
=1.90

12. Sensitivity analysis:
16% DECREASE IN DEMAND:
New Sales Unit=462 Units and Ending Inventory Unit=48 Units
Details Amount (BDT)/Unit Amount (BDT)- Total
Sales (462 U) 120 55440
(-) Total Variable Cost 71.375 32975.25
=Contribution Margin 48.625 22464.75
(-) Total Fixed Cost - 12675
Operating Income 9790
 Through Operating Leverage=1.90*(16%)=30.4% Decrease In
Operating Income
 So, New Operating Income=14069-(14069*30.4%)=BDT 9790

13. Sensitivity analysis:
12% INCREASE IN DEMAND:
New Sales Unit=616 Units and Ending Inventory Unit=8 Units
Details Amount (BDT)/Unit Amount (BDT)- Total
Sales (616 U) 120 73920
(-) Total Variable Cost 71.375 43967
=Contribution Margin 48.625 29953
(-) Total Fixed Cost - 12675
Operating Income 17278
 Through Operating Leverage=1.90*(12%)=22.8% Increase In
Operating Income
 So, New Operating Income=14069+(14069*22.8%)=BDT 17278

15. THANK
YOU !!!