1. Submitted to: Mr. Nirav Majmudar.
Submitted by: Shruti Modi (43)
Ruchit Doshi(26)

2.  Hemant Industries was founded in 1971 by an entrepreneur
Dr.P.T.Shah. The company served majority of the industries like IPCL, GSFC,
IOC, L&T, Tata Chemicals Ltd., United Phosphorous Ltd., GACL, and many
more industries in and around Baroda.
 Hemant Industries apart from Import substitution items, the products
manufactured were Ball valves - which were supplied to the Baroda
Municipal Gas line project - first of its kind in Gujarat. And also supplied to
many large and medium scale industries. Needle valves Vernier
Manometers - for instrumentation applications in industries.
 As the need rise, the company slowly switched over to the various products
on safety and thus started manufacturing Air Movers, Flange Guards. The
good reputation of providing quality service and good setup gained them
the esteem approval of the Department of Explosives, Government of India,
Nagpur, for the manufacturing of the safety fittings.

3.  Hemind's Air Mover
To dilute the general atmosphere at a
confined space with fresh air, enough to
keep the concentration of toxic vapor in the
confined area within safe limits and to
remove contaminated air, replacing it with
Air suitable for breathing.
 HEMIND'S FLANGE GUARD
It is a simple single joint strap, to be used to
fix on the flange joints. It is made of
Polypropylene and is durable and has got
resistivity for high pressures and high
temperature It can be used in acids..

4.  Hemind's Safety Fittings
 Hemind's E-Kit
 Industrial Safety Helmet

5.  All costs incurred by the firm must be accounted for in its
financial statements
 MANUFACTURING COSTS
Direct Labor (DL)
Direct Materials (DM)
Overhead (OH)
Indirect Materials
Indirect Labor
Other
 NON-MANUFACTURING COSTS
Marketing or Selling Costs
Administrative Costs

6. Aggregate of all expenses relating to indirect
material cost, indirect labor cost and indirect
expenses is known as Overhead.
Advantages of overhead:
• To Calculate the full cost of output or activities.
• It manages and controls the costs of Output.
• It gives report to internal and external
Stakeholders.

7. 3. Inputs such as labor and capital equipment
are also incurred to make the product. The
costs of all the inputs used in the
manufacturing facilities are recorded in WORK
IN PROCESS INVENTORY
4. As products are finished, they are moved to
finished goods warehouse and their costs are
recorded in FINISHED GOODS (FG) INVENTORY

8.  Overheads can be reduced by delaying
purchases of new equipment.
 Leasing new equipment rather than buying it
outright.
 Renegotiating the contracts with suppliers.
 Staff costs can be reduced by restricting
overtime or cutting staff hours.

9.  Step 1 –Identify Direct/Indirect costs
 Step 2 –Organize “Cost Collection” by creating “Cost
Centers” and record expenses in that manner
 Step 3 –Identify costs that can be ‘allocated’ and those
that need to be ‘apportioned’
 Step 4 –find suitable bases to relate the overheads
collected to the product/service delivery
 Step 5 –Calculate overhead absorption based on the rates
and measure product / service costs accordingly

10.  In order to control costs it is necessary to trace
them to the area responsible for the costs.
Production
Cost Centres
2 types of Cost Centre
– these are involved in the manufacturing
process such as machining and assembly
Cost Centres.
Service
Cost Centres
– these are not involved in the actual
manufacturing process but provide services
to the production Cost Centres such as the
maintenance and stores departments.

11.  Step 1
Direct Costs
– are ALLOCATED to a Cost Centre.
Power, Lighting and Heating
(when separately metered),
Repairs and Maintenance to
a machine
Cost Allocation refers to the allotment of whole items
of overhead costs to cost centres; that is, overhead
costs can be allocated directly to a Cost Centre.

12. Overhead Cost Basis of
Apportionment
Rent, rates, heating and
lighting
Depreciation and insurance
of plant and machinery
Canteen, factory
administration costs
Power
floor area, size of department
book value of the fixed
assets
number of employees
horse power of machines

13. Service Overhead Cost Basis of Apportionment
maintenance man hours or value
of the capital equipment
cost of materials used or material
requisitions
number of employeesCanteen, personnel and
security guards' wages
Maintenance
Cleaning
These departments exist for the whole business not just one department and
therefore these Service Costs must be APPORTIONED among the other
Production Departments, again using a suitable basis.

14. ABSORPTION OF COSTS
This is often also referred to as Overhead Recovery.
Overhead Absorption refers
to the method of charging a
proportion of the final
production cost centres'
overheads onto a particular
job on the basis of for
example,
the number of labour
hours or machine hours
taken to complete the job.

15. Rate per Direct Labour
Hour
Total Predetermined Overheads / Total Labour Hours
Machine Hour Rate:
either
Total Predetermined Overheads / Total Machine Hours
when Labour Hours in the
relevant factor
Area occupied by machine –
rates, rent etc
Cost of operating –
depreciation, power etc