INTRODUCTION

The information concerning the Management to control it financial accountancy also serves and business enterprise is very helpful to the way. As the other branches like accountancy

in an efficient

management accountancy, the cost information

the Important

to the regarding the operating to lay

efficiency if the business, down management

it becomes

very easy for management decisions

policies, to guide management

or evaluate

operating management performance with accounting.

the information provided by cost

The management the term operation in business terminology refers to an activity of the business. It is very detail because the entire business important to study the of the business in Depends on on the operation, which it

performs. Should always concentrate

the efficiency of the operation and control the

also the costs associated to the operations. It is very important to costs associated to the Operations for companies, companies engaged in the enterprises

like manufacturing

The process of extraction of materials from

earth like, bio energies etc. Generally,, the above-mentioned business enterprises depend on the operation that it has to be performed in to produce the final Operating costs which are incurred t o perform

output. The cost associated wroth such operations are generally higher. The costs are called as The costs

the operation of the enterprise, are called as operating costs. The costs are to be accounted for in order to arrive at the total costs of operation Or process, which helps in determining the price of the final product.Cost Accounting is the classifying recording and appropriate of products or service, and

allocation of expenditure of the determination

to the presentation of suitably; arranged data for the guidance of management.

1

purpose of control and

It includes the ascertainment of the costs of every process, operation, service or contract as may be appropriate. It selling and distribution It is classification particular deals with the cost of production, such analysis cost of and any

thus, the provision of as

of expenditure

will enable the total with

unit of production to be ascertained

reasonable degree of

accuracy and at the same time to disclose exactly

how such total cost is other

constituted (I.e. the value of material used, the amount of labors and

expenses incurred) so as to control and reduce the cost. The term Operation herein general refers to any activity, which I engaged in converting the raw

materials into finished goods or the process of producing or extracting the final product. This project is concerned with the operation of extracting the local form the underground and the cost associated with that operation. The company produce

the bio energies from two types namely Open cast energies and underground energies More specifically this project focuses on the costs of operations in underground mines. In underground mines the company follows various technologies to produce the bio energies are as follows. Long walls BG panels Continuous miner Side Discharge loaders Load Haul Dumpers

In hand section the bio energies is extracted entirely with manpower. In machine the bio energies Is produced with the help of machines. In energies the production process depends largely on machines but it requires some

skilled manpower also. The study focuses on the machines called side discharge loaders. For the purpose of the detailed area it was observed. In this the bio energies produced with the help of chines called SDLs (side discharge

loaders0besides hand section. Extraction of bio energies in hand section entirely depends on the manpower. The process of extraction of bio energies from an

underground which is using the technology of hand section is as follows. cleaning and other process after which the bio energies can be used. After this process the bio energies can be transported to the customers Another technology of

extracting bio energies is using SDLs is to improve safety, avoid the human drudgery of carrying baskets at work apace and also better conservation of

bio energies. In the where the technology of SDLs is using the bio energies can be extracted as follows. Blasting of bio energies with the help of explosives o separate it from the machine instead of men can fill the bio energies. These machines are called as side discharge loaders (SDLs). After the blasting the bio energies SDLs move towards the face, takes the bio energies into its basket and comes back(in the same direction without turning back)and discharge the bio energies onto a belt. The belt takes the bio energies and dumps into the tubs of the tub train and these tubs will bring the bio energies to the

surface. The capacity of the bucket of the machine is one tone. The time taken by the machines it move from the coverage belt to the face where the bio

energies lift the bio energies into the bucket and to discharge the bio energies onto the coverage belt is called Lead Time. The lead time takes the major part in computing the cost of the production and vice a versa. production. Shorter the lead time larger the

The process will generally include the following costs: 1. 2. Wages (filling and time rated) Wages of other executives

3. Explosives 4. Power 5. Bio energies transportation 6. Other stores 7. Sand stowing 8. bio overheads 9. Workshop overheads

10. CSP overheads 11. Depreciation of mines 12. Depreciation of common assets 13. Inters

NEED OF THE STUDY

1. Analyze the same worth the turn over the years. 2. To determine the cost of each operation involved in a process. 3. It helps management in making more accurate estimated about the cost of similar jobs to be executed in future on the basis of past records. 4. Special order concerns manufacture products in clearly distinguishable loss in accordance with special order and individual specification 5. Each process is designated as separate cost centre and the cost per unit calculated by dividing the total costs of the process with the total number of units produced by the process.

OBJECTIVES OF THE STUDY

1. The find out the cost of product at each stage in manufacturing. by undertake an item and study the operating cost of the company. to highlight the efficiency of operating cost of the company through various parameters. 2. To make suggestion if any for improving the practical positions of the firm regarding operating SCOPE OF THE STUDY The area of the study was restricted to the bio energies pvt ltd and its operations.

METHODOLOGY OF THE STUDY Determination of the input required to be introduced in the operation.

Calculation of the cost of raw materials required to produce one piece of finished product. To find out the operating profit ratio. Calculating the operating ratio Research methodology The study is based on secondary data and examines the total costs vs. operating costs. The results are drawn mainly from the sources Secondary data has been collected from the various sources such as Publications of the company. Business magazines. Journal, text books. Company websites. Annual reports. In order to gain information on current processes and operations the area chosen for study is the gopalapuram area in khammam Limitation of the study Coverage area was only limited to one bio energies in the Company 2. The financial data of the energies is limited to one years 3 .The analyses are based on only monitory information and Monitory factors/ information are ignored. 4.While computing number, percentage, the figure was Approximated 5. The period of study limited only for five year the is from 2007- 08 to 2011-12 6. The operating cost of the bio energies is confined to the area of gopalapuram district.

INDUSTRY PROFILE
The electric power industry provides the production and delivery of electric energy, often known as power, or electricity, in sufficient quantities to areas that need electricity through a grid connection. The grid distributes electrical energy to customers. Electric power is generated by central power stations or by distributed generation. Many households and businesses need access to electricity, especially in developed nations, the demand being scarcer in developing nations. Demand for electricity is derived from the requirement for electricity in order to operate domestic appliances, office equipment, industrial machinery and provide sufficient energy for both domestic and commercial lighting, heating, cooking and industrial processes. Because of this aspect of the industry, it is viewed as a public utility as infrastructure.

Energy is required for everything that we do, and it is the next important thing apart from the food upon which the lives of nations depend. Lack of power could cause economies to cripple. The flourishing power generation industry is considered to be a sign of prosperity for any nation. Energy comes in various forms but electrical energy is the most convenient form of energy since it can be transported with ease, generated in a number of different ways, and can be converted into mechanical work or heat energy as and

when required. In this article we will learn about a few of the most commonly used methods of generating electrical energy. THE POWER PLANT: Power or energy is generated in a power plant which is the place where power is generated from a given source. Actually the term generated in the previous sentence is a misnomer since energy cannot be created or destroyed but merely changed from one form to the other. More correctly, a power plant can be said to be a place where electrical energy is obtained by converting some other form of energy. The type of energy converted depends on what type of power plant is being considered. In the industrial use of the word, the term power plant also refers to any arrangement where power is generated. For example the main engine of a ship or an airplane for that matter. TYPES OF ENERGY SOURCES: Oil is the worlds favorite energy source which comprises 38% to the total energy production closely followed by coal (26%) and gas (23%). Both nuclear and hydroelectric energy sources contribute equally at 6% each with the remaining 1% coming from solar, wind, wood, wave, tidal, and geothermal sources. The supply of oil has both geopolitical and strategic implications for the entire world. It is geopolitical because the large known oil reserves are in the Middle East which is a region considered to be anti-American. It was the hidden agenda in the U.S. invasion of Iraq and the toppling of a legitimate or some say illegitimate, presidency of Saddam Hussein. Iraq has the 2nd largest known oil reserves in the world after Saudi Arabia.

Electricity diagram Oil was used once before as a political weapon by Arab countries when the cartel of OPEC (Organization of Petroleum Exporting Countries) was still strong then. The discovery of new and large oil fields in countries which are not members reduced OPECs political and economic clout on the world stage. It is also strategic militarily because it is one of the war materials a country needs to wage and win wars. Oil, like copper and aluminum, is a strategic raw material and the U.S. imports a lot of oil not for its consumption but for stockpiling in underground salt mines in Utah and Nevada. These reserves from its strategic planning to ensure supplies of critical materials in wartime. The Strategic Petroleum Reserve is filled up to 700 million barrels which is equal to about a months energy consumption by the U.S. There has been a frantic search for oil by drilling in such pristine areas as Alaska, around the Great Lakes area and continental shelf but it carries the risk of degrading the ecosystem and the environment.

Energy consumption graph Coal consumption has been increasing for the past years because of the fantastic price increases of oil in world markets. Coal is relatively cheaper compared to all other energy sources and new carbon-emission technologies allowed cleaner burning. Another reason for its comeback is its availability in the
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U.S. mainland and therefore it is less vulnerable to supply disruptions than oil which is mainly imported from other countries.

Water energy Gas is a cleaner fuel compared to either oil or coal but has its own drawbacks. One is the safe transport of gas since it is very flammable or combustible. This energy source is cooled and pressurized to make it into liquid form for easier and safer transport. The correct term for it is liquefied natural gas (LNG) or liquefied petroleum gas (LPG).

Nuclear energy Nuclear power is a significant energy source in some countries like Germany and France. Its critics always cite safety concerns because of what happened at the Chernobyl reactor. The meltdown and resulting explosion spewed clouds of radioactive material into much of Europe and is the leading cause of birth defects due to genetic mutations. There is a new nuclear reactor technology that uses ceramics for its core. Ceramics can prevent meltdowns because it has a very high tolerance for extreme heat.

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Hydroelectric power energy Hydroelectric power is the alternative energy chosen by some countries who do not want nuclear plants due to safety concerns. This is a viable alternative when a country has sufficient water supplies. The largest dam for years is the Hoover Dam in the U.S. between the borders of Arizona and Nevada. Today, that distinction now belongs to the Three Gorges Dam in mainland China. When it becomes operational in 2012, it will be the largest hydroelectric power station in the world producing some 22,500 megawatts. The argument against building dams to produce electricity is dislocation of the people living nearby and the resulting changes to the environment. The dam made many historical monuments, archaeological sites and cultural villages now underwater and gone forever. This Chinese dam spans the Yangtze River in the Hubei province and is the largest civil works project since the construction of the Great Wall. A reason for building this giant dam is flood control along the entire Yangtze River. Estimated total cost of this project is US$25 billion when completed and it needs to generate about 1,000 terawatts in 10 years for its construction costs to be fully recovered. China has a 14-facility hydropower long-term development plan in place until 2020.

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DIFFERENT TYPES OF POWER PLANTS: Steam power plants use fuels such as petroleum, coal, or biomass are burned to heat water to create steam, the pressure of the steam spins a turbine turning the copper wire inside the generator. Geothermal power plants are steam power plants that tap into steam released from the earth. Once used the water is returned to the ground. Gas power plants use fuels that are burned to create hot gases to spin the turbine. Nuclear power plants nuclear generators use nuclear fission to turn water into steam. This drives the steam turbine, which spins a generator to produce power. A pound of highly enriched uranium can power a nuclear submarine or nuclear aircraft carrier is equal to something on the order of a million gallons of gasoline. Wind power plants use the wind to push against the turbine blades, spinning the copper wires inside the generator to create an electric current. Hydroelectric dams use falling (or flowing) water to spin the turbine blades. Coal plants burn coal to drive a steam engine. Coal is plentiful, but the collateral damage is extreme. Fossil fuel power plants burn oil to drive a steam engine. Burning fossil fuels is increasingly expensive, and highly polluting. Oil supplies will run very thin in the coming decades.

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PERFORMANCE: The capital-intensive power industry suffered tremendous losses due to the economic recession. Industry analysts have revealed that there was a staggering 50% decline in the number, value and capacity of new projects between the beginning of the credit crunch in Q3 2009 and Q3 2010. There is a silver lining though, as analysts believe figures for Q3 2010 have shown signs of positive growth. Going forward, it is believed the hotspots of activity will primarily be in India, China and the UK. As well as new builds, there are also significant opportunities for synergies across the global energy supply chain with industry and governments keen to invest in and adopt new technologies. In order to best capitalize on these new opportunities, major contractors and companies across the energy supply chain have begun to work together more closely, to streamline their operating and procurement procedures. India has the fifth largest electricity generation capacity in the world. The total installed capacity of India is ~150,000 MW, of which majority of generation, transmission and distribution capabilities with either public sector companies or with State Electricity Boards (SEBs). Only ~15% capacity is from the private sector, though this is now beginning to increase. Market research suggests ~65% of Indias total installed capacity is contributed by thermal power with the Western and Southern regions each accounting for ~30%. Due to unbalanced growth and rural-urban disparity, only ~40% of rural household have access to electricity versus ~80% of urban households. Key players include National Thermal Power Corporation Limited, Nuclear Power Corporation of India Limited, North Eastern Electric Power Corporation Limited, Power Grid Corporation of India and Tata Power.

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GROWTH POTENTIAL: The Indian power sector is experiencing a large demand-supply gap. At present, the energy shortage in the India is ~10% but there are States where the energy shortage is as high as 25%. To combat this, over 80,000 MW of new generation capacity is planned in the next five years. A corresponding investment is required in Transmission and Distribution networks. The Indian Ministry of Power has set a goal, Mission 2012: Power for all and released a comprehensive sector development blueprint. The main objectives, in addition to providing 100% access to power, are to provide sufficient power to achieve targeted GDP growth rate of 8%, provide reliable and good quality power and to enhance commercial viability. A huge capital investment of about US$ 200 billion is required to meet Mission 2012 targets. This has welcomed numerous global companies to establish their operations in India under the famous PPP (public-private partnership) programs. Additional massive capital investment is further required over the subsequent years with the countrys power requisite expected to touch 800,000 MW by 2031-32. FUTURE PROSPECTS: Due to the influx of foreign companies, and the ramping up of operations by domestic companies, the industry is experiencing a hiring spike. New graduates would be advised to seek an initial position in one of the larger companies as there will be specific training courses and more opportunities for someone starting out. Given the breadth of the power industry, it is possible to work with a range of different technologies and disciplines depending upon your preferences.

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All of the large power-generation companies are looking for graduates and apprentices in a range of disciplines. Degrees in engineering (mechanical, electrical or civil), science (physics, chemistry or mathematics) and even IT or business studies are required. In addition, work experience is a big advantage. POWER INDUSTRY IN INDIA: The critical role played by the power industry in the economic progress of a country has to be emphasized. A self sufficient power industry is vital for a nation to achieve economic stability. INDIAN POWER INDUSTRY: Before Independence The British controlled the Indian power industry firmly before Independence. The then legal and policy framework was conducive to private ownership, with not much regulation with regard to operational safety. POST INDEPENDENCE: Immediately after Independence, the country was faced with capacity restraint. India adopted a socialist structure for economic growth and all the major industries were controlled by public sector enterprises. By 1970's India had nationalized most of its energy assets, due to its commitment to social goals. By the late 1980's the Indian economy felt the strain of the socialist agenda followed since independence. Faced with a serious deterioration in public finance and balance of payment crisis, the Union government as part of its policy of economic liberalization allowed greater investment by private sector in the power industry.

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POWER Constitutional Position Power as a matter of legislative and executive competence, falls in the Concurrent List (List III of the Seventh Schedule to the Constitution of India).Both the Parliament and state legislatures have the rights to pass laws on the matter and any law passed by the Parliament overrides the existing state laws unless.

The existing law is conserved or saved from such a repeal or A law passed by the state legislature receives acknowledgment from the President of India.

POST LIBERALIZATION: Understanding the critical part played by the power industry, the Union government passed several laws and restructured the Power Industry to gear it up to meet the challenges posed to the Indian economy post Liberalization. Electricity Bill 2001 Learning from the experience gained through various reform initiatives, the Indian government passed the Electricity Bill 2001.The Bill seeks to

Consolidate and rationalize existing laws. To address the issues of developing industry including regulation, power trading, non discriminatory open access, choice of dispensing with vertically integrated state enterprises and encouraging private enterprise.

Energy Conservation Act 2001 The Act was enacted by the Indian government to facilitate stringent steps to ensure the efficient use of energy and its conservation. A Bureau of Energy Efficiency was set up to monitor and regulate the Power Industry according to the provisions of the act.

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NON RENEWABLE ENERGY: FOSSIL FUELS: The Industrial Revolution in Europe in the 19th century forced human's to seek alternative sources of fuel to cater to the increasing demand. Focus was shifted to fossil fuels as an alternate source of energy. Fossil fuels were formed millions of years ago. They are nothing but fossilized organic remains that after millions of years has been converted into oil, gas and coal. Because this process takes a long time, they are known as non renewable. COAL: It is the most easily available fossil fuel in the world. It is mostly carbon and is used as a combustion fuel, especially after the Industrial Revolution. Coal can further be divided into lignite, bituminous and anthracite. Lignite and Bituminous have lesser percentage of carbon and therefore burn faster. They are not environmentally friendly, Whereas Anthracite has about 98% carbon and therefore burns slowly and is more environmentally friendly. Coal can be found in both underground mines and open mines. Though Petroleum gained prominence through the 20th century, coal still continues to be the most used raw material for power generation. Oil and Gas: Oil and Gas is mostly found in underground rocks. Millions of years ago when plants and animals died, they got buried in layers of mud and sand. The earth's crust changed its shape and put immense pressure and heat on the dead plants and animals. Over a period of time, the energy in those plants and animals changed into hydrocarbon liquids and gases. They then turned into chemicals called hydrocarbons .Most of the hydrocarbons is found under the sea bed. Oil has a disastrous effect on the environment and many scientists believe the main reason for global warming.

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Natural gas is usually found near a source of oil. It is a mixture of light hydrocarbons. It is lighter than air and is odorless. It is therefore mixed with a chemical that gives it a strong our and thereby easy to detect in case of a leak. It is the cleanest burning fossil fuel. RENEWABLE ENERGY: Because of the environmentally disastrous effect of non renewable energy, an alternate source of energy which would not pollute the environment and which can also be renewed was tapped. They are known as renewable energy. The various types of renewable energy are SOLAR ENERGY: It is the most easily available renewable resource. After the oil shock in 1970's many countries conducted research work to tap solar energy. It is believed in the next few years millions of consumers across the world would switch to solar energy. In India the Indian Renewable Energy Development Agency and the Ministry of Non Conventional Energy Sources are devising strategies to encourage the usage of solar energy. Solar energy can be used for cooking, heating, drying, distillation, electricity, cooling, refrigeration, cold storage etc. HYDEL ENERGY: Energy available in fast flowing water can be used to generate electricity. Waves occur due to the interface of the wind with surface of sea and represent a transfer of energy. This energy can be tapped for commercial purpose. HYDRO POWER: It is the one of the best, cheapest and cleanest source of power, though large dams could have environmental and social repercussions. In view of these problems associated with larger dams, experts have advocated the construction of smaller dams. New environmental laws to safeguard the planet from the effects of global warming have made smaller hydropower projects more viable.

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WIND ENERGY: It is the kinetic energy used for many centuries in water sports like sailing and for irrigation. It converts kinetic energy into more usable forms of power. Wind turbines help to convert the energy in the wind into mechanical energy which can be used for generating power. Since the late 1980's the viability of wind energy has gained in prominence across the globe. In India the states of Tamil Nadu and Gujarat lead in the field of wind energy. BIOMASS: It is sourced from the carbonaceous waste of animals and is also the by products from timber industry, agricultural crops, raw material from forest, household waste and wood. It can be used to generate power with the same power plant that are burning fossil fuels and is very much environmentally friendly. It is being used in the western countries for applications such as combined heat and power generation. In India 90% of the rural households and 15% of the urban households use bio mass fuel. NUCLEAR ENERGY: Nuclear energy can be created in nuclear reactors under strict human control. The nuclear power can be generated by the fission of uranium, plutonium or thorium or the fusion of hydrogen into helium. Nowadays mostly Uranium is used for generating nuclear power. With a view to increase India's dependence on nuclear energy to offset the energy crisis in the country, the Indian government entered into an agreement with the government of USA called the 123 agreement. This agreement aims to assuage greater cooperation between the two countries in the field of nuclear technology.

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FUTURE TRENDS:

According to experts the private sector would play a greater role in power generation and foreign investments would increase considerable in his sector.

The government of Indias Hydrocarbon vision 2025 gives in details the guidelines for the policies in India for the next 25 years to attract investment in exploration, production, refining and distribution of petroleum products.

INDIA POWER SECTOR: India power sector or the power industry in India comprises of the various governmental bodies looking after the power systems in India, power generation industry and technologies in India, power supplies, power industry report showing the analysis of the power scenario in India, the India power requirements and shortage, the various India power supply unit and the power infrastructure in India. MINISTRY OF POWER: Indian power sector comes under the Ministry of Power India. Earlier known as Ministry of Energy, it comprised of separate departments for power, coal and non-conventional sources of energy. In 1992, the Ministry of Power started working independently with work areas covering planning and strategizing the Indian power projects and policies. The power management and implementation of the various power projects undertaken, formulation and amendments of the power laws in India, management of the power supply in India, monitoring of the power plants in india, power companies in India, power generation in India and other power shortage problems etc.

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The Ministry of Power (MoP) is coordinated by Central Electricity Authority (CEA) in all technical and economic aspects. Along with the CEA, other subsidiary organizations of the Mop are:

National Thermal Power Corporation (NTPC) National Hydro Electric Corporation (NHEC) Power Finance Corporation of India (PFCI) Nuclear Power Corporation of India Limited North Eastern Electric Power Corporation (NEEPC) Rural Electrification Corporation (REC) Damodar Valley Corporation (DVC) Bhakra Beas Management Board (BBMB)

POWER INFRASTRUCTURE IN INDIA:

The power industry in India derives its funds and financing from the government, some private players that have entered the market recently, World Bank, public issues and other global funds. The Power Ministry India has set up Power Finance Corporation of India that looks after the financing of the power sector in India. The Power Finance Corporation Limited provides finance to major power projects in India for power generation and conversion, distribution and supply of power in India. Power Finance Corporation (PFC) Ltd India also looks after the installation of any new power projects as well as renovation of an existing power project India. The PFC in association with central electricity authority and the ministry of power facilitates the development in infrastructure of the power sector India. They have taken up construction of mega power projects that will answer to the power shortage in various states through power transmission through regional and national power grids.

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POWER SUPPLY UNITS INDIA: Power is derived from various sources in India. These include thermal power, hydropower or hydroelectricity, solar power, biogas energy, wind power etc. the distribution of the power generated is undertaken by Rural Electrification Corporation for electricity power supply to the rural areas, North Eastern Electric Power Corporation for electricity supply to the North East India regions and the Power Grid Corporation of India Limited for an all India supply of electrical power in India.

Thermal Power in India is mainly generated through coal, gas and oil. India coal power forms a majority share of the source of power supply in India. The electric power in India is generated at various thermal power stations in India. The power generated at these thermal power plants is then distributed all over India through a network of powergrid at regional and national levels. The power ministry organization responsible for the thermal power management in India is the NTPC.

Hydropower is India is one of the mega power generators in India. Various hydropower projects and hydro power plants have been set up by the ministry of power for generation of hydro power in India. Various dams and reservoirs are constructed on major rivers and the kinetic energy of the flowing water is utilized to generate hydroelectricity. The power generator here is the running water. The hydroelectric power plants and the hydro power generation companies are managed by the National Hydro Electric Power Corporation (NHPC).

Wind Power in India is available in plenty as India witnesses high intensity winds in various regions due to the topographical diversity in India. Efforts have been made to utilize this natural source of energy available free of cost for wind power generation.
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Huge wind energy farms have been set up by the government for tapping the wind energy by using gigantic windmills and them converting the kinetic energy of the wind into electricity by the use of power converters. The wind power advantages start with the very fact that a wind energy power plant does not require much infrastructure input and the raw material i.e. wind itself is available free of cost.

Solar Power in India is being utilized to generate electricity on smaller scale by setting up massive solar panels and capturing the solar power. Solar power India is also being utilized by the power companies in India to generate solar energy for domestic and small industrial uses.

Nuclear Power in India is generated at huge nuclear power plants and nuclear power stations in India. A nuclear power plant generates the electricity using nuclear energy. All the nuclear power plants in India are managed by the Nuclear Power Corp of India Ltd (NPCL). The electricity from all India nuclear plants is distributed by the NPCL as per the nuclear power project scheme.

Biogas Production in India is still in its infancy stage. Also the number of biogas plants in India is still very low. India being the largest domestic cattle producer has plenty of biogas fuel and thus utilization of the fuel for mass biogas production by setting up more biogas plants in India would solve the power shortage problem to some extent.

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POWER COMPANIES IN INDIA: Many government as well as private organizations have taken up the task of power generation in India. The major Indian power companies playing prime are:

Bhakra Beas Management Board Enercon Systems India Essar Group GMR Group Gujarat State Petroleum Corporation Ltd Jindal Steel & Power Limited Karnataka Power Transmission Corporation Limited (KPTCL) Karnataka Renewable Energy Development Limited Konarka Magnum Power Generation Limited Nippo Batteries Reliance Energy Ltd. Shri Shakti Durgapur Projects Limited Satluj Jal Vidyut Nigam Ltd. United Power Ventral Systems Pvt. Ltd. Enron India Power Plant Celetronix Power India Caterpillar Power India Man is blessed with abundance of natural resources, Including Mineral

wealth that play vital role

in the Development of a country and promote the made best use of them.

economic growth when explored and

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Bio energies, which is one of the

important electricity, is Known to

man since ages and this natural wealth has put to diverse use in the modern world. Bio energies regarded as the fuel for growth, the bio energies an important input for power generation and many other industries like iron and steel, etc, a vital infrastructure for

railway, shipping and construction industries

economic development. Despite the development for alternative fuel sources like electricity, petrol and solar energy, bio energies continues to be material in many industries. Thus in the industrial development of major fuel

bio energies industry plays an important role any country, like India. The world bio tones in 2000 to

energies consumption is projected to go up from 4 billion

6 billion tones by 20, primarily in china and India which are expected to Account for 75% of the started in 1774 and is increased consumption. In India, bio energies was still significantly under the Government control and

Ownership with bio energies India worth its following subsidiaries Subsidiaries are become number one bio energies producer in India HISTORY: The year 1921 witnessed the formation of the Secendrabad Deccan

company private limited and it acquires the lights for exploiting the bio energies reserves. The first commercial operation commenced at Gopalapuram Kkhammam district) in Andhra Pradesh in 1921. In 1991 the company. Re- christened the Gowthami private company limited and its scrip listed on the National stock Exchange. The exploiting the bio energies right

reserves were acquired by the Hyderabad Deccan company,

which was incorporated at national stock exchange. Hence The first extracting of bio energies was started at Gopalapuram in 1886 by eastgodavari company the after company became government company

purchased its shares from National stock exchange in 494. With this,
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GBPL

became the first-ever government managed bio energies company in

India. Later in the year 1949, energies came under the control of governments of India and Andhra Pradesh as a joint venture with equity ration of 49%

and 51%respectively. The energies Is engaged in bio energies in four districts of Andhra Pradesh namely. Khammam, area producing 1 of total bio energies.

The operation areas of gbpl are as follows:

KHAMMAM DISTRICT gopalapuram. The bio energies reserves stretch over 3 square kms. Of khammam above districts of Andhra Pradesh with proven deposits of 8,575 million tones of bio energies. snow operates forty two (42) under ground mines and thirteen(13) open cast energies in these four(4)districts. Technologies & their output in GBPL: NAME OF THE TECHNOLOGY PERCENTAGE TO TOTAL OUTPUT in 2007-08 Traditional underground energies Opencast energies Long wall technology 16% Blasting gallery technology 15% 69%

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MANPOWER OF GBPL SLNO 1 2 3 4 5 6 7 8 9 10 CATEGORY Top Executives Executives Supervisory Secretarial staff Technical staff Skilled(daily rated) Semiskilled(daily rated) Unskilled(daily rated) Unskilled(piece rated) Apprentices Total 25 39 23 96 184 52 193 167 4 787 31-05-2012 4

GBPL-MISSION: To retain strategic role of a premier bio energies producing company in the country and excel in a competitive business environments. To strive for selfreliance by optimum utilization of existing resources and earn adequate returns on capital employed.

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To exploit the available energies utmost safety by

blocks with maxim Conservation and

adopting suitable technologies and practices and constantly

upgrading them against international bench marks. To supply reliably and qualitative bio in adequate quantities and

strive to satisfy customers

needs

by constantly harmonious industrial

relations with the legal and social frame work of the state. To emerge as a responsible company through good corporate

governance, by laying emphasis on protection of environment & ecology and with due regard for corporate social obligations.

GLOOM TO GLORY: The GBPL was receiving budgetary support from both government of India and Government of Andhra Pradesh till some time age, but they later

abandoned. Also the pricing of bio energies was decided by government of India keeping its impact on their major sectors like, power, railways, cement etc. the prices were not revised regularly, also hike in input cost due. To periodical revisions of national bio energies wage agreements (NCWA) stores and interest were also not fully compensated by government. The frequent strikes by the workers, law and order problem , low productivity, apart from un-Remunerative bio energies price vis--vis cost of production during the period 1989-90 to 1991-92 affected the financial health of the company and refer referred to BIFR in may 1992, but due to liberal financial package extended by the govt. of India in consultation with govt. of AP, and sustained effort made by the management GBPL financial turnaround was achieved. and Trade unions, a modest

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The company earned profit of Rs.17.76 core and 26.64 cores in 1993-94 and 1994-95respectively. My march 1994, GBPL came out the BIFR purview. Following remedial measures/reforms were taken by the company for success: Unifying trade unions through path breaking elections. High pitch communication drives harnessing media, launching literacy programmers. Focused multi-faceted workers welfare programme. Establishing outsourcing of non-core and ancillary activities. Innovative programmers launched(Dial-your-GM, field visits, intersections, follow ups) Fuel supply agreements-technology infusion for quality testing, workforce visits to client sites. Focus on safety, environment protection and lab our welfare. The process of turning around a sick company, which commenced in 199798, reached its logical conclusion when GBPL totally, wiped out its accumulated losses and entered the financial year 203-04 with ant profit of Rs80.45 core after issuing a dividend of Rs 86.70 core

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.S,no

particulars

Units

Pre-2000 (2002-03)

Post-2003 (2006-07) 33.24

Gain/reduction(%)

Bio energies production

M.tonne s

28.73

(+)16%

Bio energies dispatches

M.tonne s

28.83

33.37

(+)16%

Overall output per man shift(OMS)

Tones

0.98

1.51

(+)54%

4 5

Manpower No.of strikes

Nos. Nos.

1,14,486 310

97,053 35

(-)15% (-)83%

Turn over

Rs.incrs

2114

3689

(+)75%

COMPUTERIZATION IN GBPL: GBPL has initiated computerization activity in the utilizing Accounting early eighties

management information system, personnel, personnel

data (EPR), in inventory management.

30

Computerization has been introduced in the supply and allotment of bio energies to the industries All documentation of in the non-core sector by the marketing department. data pertaining to over 200 industrial consumers has has been issuing

been total computerized. The marketing department

computerized sale notes to all the industrial consumers with in 24 hours of receipt of requests from the consumers . Daily a computerized statement indicate the sale notes issued to consumers and the requests pending at the each day is displayed on the notice board of the marketing department computerized selection of candidates recruitment system by which

was Completed within 24 hours of written test evolved

to remove the subjectivity in the Selection process and this was appreciated by the candidates as well as the general INDUSTRIAL RELATIONS: Industrial relations are one of the most delicate and complex elements of a modern industrial society. Industrial relations have now become a part and parcels of the science of management because they deal with the manpower enterprise. The term industrial relations refer to industry and relations. Industry means any productive activity in which an individual is engaged and trade unions on wages and other terms of employment. The day-to-day relations with a plant also constitute one of the important elements and impinge on the broader aspect of industrial relation. The primary objective of industrial relations is to bring about good and healthy relations between the two parries in industry-labor and management. public.

31

INDUSTRIAL RELATIONS IN GBPL: To safeguard the interest of labor as well as of management by Securing

the highest level of mutual understanding and good will Between all sections in industry which take part in the process of Production. To avoid industrial conflicts and develop harmonious relations, workers and the

which are essential for the productive efficiency of industrial progress of the country.

To raise productivity to a higher level in an aera of full employment By reducing the tendency to higher and frequent absenteeism labor

To establish and maintain industrial democracy based on partnership, not only for the purpose of participating and managerial discussions so sharing

the gains of but also

that the individual personality

may be fully developed anther may grow into a civilized citizen of the county. To bring down strikes, lockouts and gelatos by providing better And reasonable wages and fringe benefits conditions. To bring about government control over such units and plants as re-running atlases where production has to be regulated in the public interest. To ensure that the state endeavors to bridge the gap between the to the works and improved living

unbalance, disordered and maladjusted social order and the need for reshaping the complex social relationships emerging out of technological advance

interest- protecting some and retraining others and evolving a healthy social order. .

32

Employee and Employers:

An amount equivalent to two and one third contribution percent of salary of the employee. COMMUNITY BUILDINGS/FACILITES: In order to provide recreation facilities the company has constructed recreation clubs and community halls in the bio energies field areas. No of community No of recreations clubs 10 32

EXPENDITURE INCURRED ON WELFARE

Year

Expenditure (Rs in lkhs)

Expenditure employee(in Rs)

per

2007-08 2008-09 2009-10 2010-11 2011-12

27681 29305 31724 37693 46800

27837 30195 3349 40925 54403

33

TARGET AND OFF-TAKE OF BIO ENERGIES During the year 2010-2011 off take of bio energies was 4 million tones Against the AP distribution polices Announced by the ministry bio energies, goal, the customers who are drawing more than 200 tones per annum have to enter in to FSA and so far 140 such customers have entered in to FSAS with the GBPL.A part from that, three power utilities, 44 paddy units 38 sponge units and 18 CPP customers have target of 2 million tones per the new bio energies

FSAS with GBPL 89% of dispatches have been covered by FSAS and joint sampling protocols agains87% covered in the previous year. The no of customers registered GBPL have gone up from 55in 2009-2010 to 63 in 2010-11 he details of sector wise AAP target and off take and enegies consumption during 2008-09 has compared to the previous year are as under MEASURES FOR IMPR1OVING QUALITY AND CUSTOMER

SATISFACTION: Modernizations of CHPS by establishing auto sampling system is in progress and labs are provided with latest equipment.washery is being established at gopalapuram on BIO basis. With a view to facilitate the customers who exisisting system e-auction of bio

are unable to get bio energies as per the

energies is introduced which bio energies can be purchased on line through simple, transparent customers on and customer friendly system complaints quality and received from

sampling,

weigh menthae slightly increased report and necessary

from 15in the previous year to 20 during year under

measures were Taken to address the complaints which lead to prompt elimination of grievances of customers.

34

INDUSTRIAL RELATIONS: The year 2009-10 has set a new record in the IR scenario of the company with zero strikes, company in establishing congenial atmosphere and maintaining industrial harmony and peace. It was possible through multi-dimensional approach which Inter-alia consists efforts in creating increased awareness among workmen, enhancing welfare measures, transparency and holding meetings eighth unions

at regular intervals, elections for according recognition to the trade unions at company and areas levels were conducted for the 4th time successfully, while the year 2008-09 strike free- the number of strikes, man days & production lost in previous year are as Under WELFARE OF EMPLOYEES AND SOCIAL SECURITY SCHEMES: Various welfare activities that are in vogue viz, housing &sanitation,

educational, Recreational, medical facilities with super specialty services and social security schemes are being continued with more vigor awareness health, Hygiene, prevention and spreading of

campaigns on the subjects of

diseases were organized extensively for the benefit of employees and the people living in near plant. The overall housing satisfaction as on 31-03-08 was 68% as against 60% at the end of previous year. INFORMATION TECHNOLOGY: Enterprise resource planning (Erp) software is being implemented in association with SAP India initially in finance, payroll, materials management and marketing and movement modules ,networking through infant is established between various departments Energies Laser profiler is introduced for survey departments. Project monitoring is integrated with estates and purchase

departments for reviewing implementation of service

35

SAFETY IN ENEGIES: The company strives constantly continuously and consistently for taken

complete safe, during the year under report several

measures were

towards improving safety which includes mechanization of and other work places , creation of awareness among the work men and their family members,

organizing training programmers and work shops, conducting safety audit The details of accidents during the year under report are indicated below: BIO ENERGIES SERVICES: The energies services of the company were developed on par with international standards and best of its kind in AP This is achieved by continuous strengthening of rescue services with the best training. Latest resourceful equipment and by adopted international best practices. The company facilities of injured persons from place of work and the same are being used on trial basis at rescue service points. During the year under report, 32 persons were

imparted initial training in rescue and recovery works and 593 active rescue trained persons working at different mines of the company were imparted 4947 refresher Man shift practices. RESEARCH AND DEVELOPMENT: During the year under report, R&D activities were taken up in UG

control studies in long wall BG panels, semi - Mechanized, wide stall method of working, simultaneous extraction support capacity, water of seams, and estimation of long Wall

dams design, determination of in-situ strength of

bio energies, degree of Gassiness and reclassification. In open cast projects, studies were carried out in High wall and dump slope stability, of optimum slope of controlled blasting. determination

benches, impact of deep hole blast vibrations and

36

The activities benefited in expediting the new projects, improving safety, mine ventilation, production and productivity, health of workmen. FUTURE PLAN OF ACTION: Ventilation studies, strata monitoring and ground control studies, Introduction of resin capsules in heavy water seepage mines in conjunction

with roof Bolters are some of the studies proposed to be conducted future ENVIRONMENT AND ECOLOGY: GBPL carries out eco-friendly bio energies and gives due concern for protection of environment, air, water, bio-diversity and nature, the

activities taken by the Company have won laurels for the company have won laurels for the company and several environmental organizations have conferred awards. GBPL takes measures on a continuous basis for keeping

quality levels of air , water, and environment within the limits and unaffected by mining and allied operations. 4sewage treatment plants were constructed during 2009-10. ORGANIZATION STRUCTURE: The successful performance of group of work any institute depends to a large

extent units organization may be defined as the process of identifying and

37

THEORETICAL FRAME WORK

The term operation in business terminology refers to an activity of the business. It is very. Important to study the operations of the business in detail because the entire business. Depends of the operation, which its performs. The also the costs

associated to the operation. It is very important to control the costs associated to the operation for the enterprises like manufacturing companies, companies engaged in the process of extraction of materials from earth like, bio energies etc. Generally the above mentioned business enterprise depend on the operation That it has to be performed in order to produce the final output. The cost

associated with such operations is generally higher. These costs are called as OPERATING COSTS The costs, which are incurred to perform the operation of the enterprise, are called as Operating costs. The costs are to be accounted for in order to arrive at the total costs of Operation or process, which helps in determining the price of the final product. Cost accounting is the classifying , recording and appropriate allocation of expenditure for the determination of the costs of products or service and to the presentation of suitably, arranged for the purpose of control and guidance of management It includes the ascertainment of the costs of very process. Operation servicer contract as may be appropriate. It deals with the cost of production.

Selling and distribution. It is thus the provision of such analysis and classification of expenditure as will enable the total cost of any particular unit of production to ascertained with reasonable degree of accuracy and at the same time to disclose exactly how such total cost is constitutes (i.e., the value of

38

material used, the amount of control and reduce the cost.

labor

and

other expenses incurred) so as to

THE FEATURES OF COST ACCOUNTING: 1. It is process of accounting. 2. It records income and expenditure relating to production of goods and service. 3. It provides statistical data on the basis of which future estimates are prepared and quotations are submitted. 4. The exact cause of decrease or increase may suffer not because of the cost of production is high or price are low also because the output is much below the capacity of the concern. 5.Efficiency of public enterprises. Costing has a more important role to play in public enterprises than in private enterprises. The primary objective of the public enterprise is not to raise profits but it is to serve the society by providing quality goods at cheaper rates. 6.The efficiency of a public sector can be best judged by comparing its cost of production with the cost of production of its counterparts.

39

ELEMENTS OF COST Elements of costs

Material

Labour

Other expenses

Direct

Indirect

Direct

Indirect

Direct

Indirect

Prediction of works OH

Administrati on OH

Selling OH

Distribution OH

By grouping the above elements the following divisions of costs are obtained. 1. Prime cost = direct material + direct labour +direct expenses. 2. Workers or factory cost = prime cost + works or factory overheads. 3. Cost of production= works cost + administration overheads. 4. Total cost or cost of sales = cost of production + selling and distribution overheads. The difference between cost of sale and selling price presents the profits or loss.

40

DIRECT MATERIALS: Direct materials are those materials which can be identified in the product and can be conveniently measured and directly enter the production and form a part of the finished product. For example timber in furniture making clothe in dress making and bricks in building a house. The following are normally classified as direct materials All raw materials like jute in the manufacturing of gunny bags, pig iron in foundry and fruits in caning industry. Materials specifically purchased for a specific job, process or order like glue for book building starch powder for dressing yarn etc. Parts or components or produced like batteries for transistor radios and tires for Primary packing materials like cartons, wrapping ,cardboard boxes, etc. used to protect finished product from climatic conditions or far easy handling inside the factory. Indirect materials are those materials which cannot be classified as direct material. For examples , consumables like cotton waste, lubricants, brooms, rags, cleaning materials, materials for repairs and maintenance of fixed assets. High diesel used in power generations etc.

41

DIRECT LABOUR: Direct labor is all labor expended in altering, construction, composition,

confirmation or condition of the product. In simple words it is that labor which can be conveniently identified or attributed wholly to a particular job, product

or process or extended in converting raw materials in to finished goods. Indirect wages are the wages paid to supervisors, inspectors etc, through not direct labor. DIRECT EXPENSES: All expenses, which can be identified to a particular cost center and hence directly charged to the center, are known as direct expenses. In other words all expenses (other hand direct materials and direct labour) incurred specifically

for a particular product, job, department etc,. are called direct expenses. These are directly charged to the product, job, department etc. Examples of such

expenses are royalty, excise duty, hire ,charges of a specific plant and equipment. OVER HEADS: Overheads may be defined as the aggregate of the cost of indirect materials, indirect Labor and such other expenses including services as cannot conveniently be Charges direct to specific cost units. Thus, overhead are all expenses that direct expenses. Over head are sub divided as Manufacturing expenses Administration over heads. Selling over heads. Distribution over heads. Research and development over heads.
42

EXPENESE EXCLUDED FROM COSTS: The total cost of a product should include only those items or expenses which are a charge against profit. Items of expenses which are relation to capital assets. Capital losses, payments by way of distribution of profits and matters of pure finance should not from a part of the costs. Examples of such expenses are income tax, dividends. Abnormal wastage Of materials, wages paid abnormal idle time, interesting capital given or

received expenses of raising capital, discount on shares and debentures profit or loss from the sale of of asset investment excessive depreciation. Appropriation good wall, preliminary expenses, and underwriting

profit, writing off

expenses etc. STATEMENT OF COST OR COST SHEET: Cost sheet is a statement designed to show the output of a particular accounting period along with break-up of costs. The data incorporated in cost sheet are collected form various statements of accounts, which have been written in cost accounts, either day-to- day or regular records. There is no fixed form for preparation of a cost sheet in order to make the cost sheet more useful it is generally presented in columnar form The columns are for total cost of the current period per unit cost for the current period and total and per unit cost for the preceding period and total and per units for the budget period and so on.

43

ADVANTAGE OF COST SHEET: It discloses the total cost and the cost per unit of the units produced during the given period. It enables a manufacture to keep a close watch and control over the cost of production. By providing a comparative study of the various elements of current cost with the past results and standard cost. It is possible to find out the causes of variations in costs and to eliminate the adverse factors and conditions which to go increase the total cost. It acts as a guide to the manufacture and helps him in formulating a define useful production policy. It helps in fixing up the selling price more accurately. OBJECTIVE OF OPERATING COST: 1. To find out the cost of the product at each stage on manufacturing. 2.It helps in finding out the cost of production of every order and thus helps in ascertaining profit on its execution. The management can judge the profitability of each job and decide its future course of action. 3. Management in making move accurate estimates about the cost of similar job to be executed by the helps of past records the management conveniently and accurately determine and quote the price for order. 4. It enables management to control operational in efficiently by companies actual Cost with the climates ones. 5.Each order should be continuously identifiable from the raw material stage to stage of completion.
44

The term operation here in engaged process of

general refers to any activity, which I

in Converting the raw materials into finished goods are the producing or extracting finalproduct.

This project is concerned with the operations of extracting the local from the under ground and the cost associated with the operation. The company produce the bio energies from two types mines namely opencast mines and underground mines. More specifically this project focus on the cost of operation in In underground mines the company follows various

underground mines technology to product

Another technology of extracting of bio energies is using SDLs. the main objective of introducing SDLs is to improve safety, avoid the human

drudgery of carrying baskets at work space and also better conservation of bio energies. In the mines where the technology of SDLs is using the bio energies can be extracted as follows. Blasting of bio energies with the help for explosives to separate it firm the earth the machines instead of men can fill the bio energies. These machines are called as side discharge loaders (SDLs). After the blasting for the bio energies SDLs move towards the face, takes the bio energies into its bucket and comes back (in the same direction without turning back)and discharge the bio energies onto a belt. The belt takes the bio energies and dumps into the tubs of the tub train and these tubs will bring the bio energies to the surface. The capacity of the bucket to the machine is one tone. The time taken by the machines to move from the coverage belt to the face were the bio energies is blasted, to lift the bio energies into the bucket and to discharge the bio energies onto the coverage belt is called lead time

45

The lead time takes the major part in computing the cost of the production. Shorter the The process will generally include the following costs. wages (Filling and time rated) wages of other executives explosives other stores power bio energies transportation sand stowing Mine overheads.workshop overheads CSP overheads. Depreciation of enegies Depreciation of common assets. Interest. Area overheads. The system being followed and the steps involved in preparation of cost sheet under the present costing system are explained as follows. A preformed cost sheet followed in presentation of cost sheet for hand section and technologies is furnished. For expenditure is presented through the cost sheet under various elements of cost. Cost ascertainment is done through cost centers allotted to the various elements of cost The total activities at the mine are divided into 39 parts and each activity is given a cost called activity cost center with two digit code starting from 01 to 39 to ascertain the expenditure .The activity wise cost centers are shown below. The Expenditure. The activity wise centers are shown below. The expenditure booked the below cost centers is treated as direct incurred at the mine. Similarly to ascertain the expenditure on various surface activities cost codes from 40 to 102 are allocated which are used to book the expenditure on the activities on the service and administrative departments etc.
46

The expenditure incurred at workshop, CSP and G.M office est. Are the examples of the indirect cost booked through below cost centers. The indirect cost is grouped into 2 parts for presentation in the mine cost sheet. They are mine overheads and area overheads. The mine overhead, which represents the incidental, costs to the direct wages like LTC/LLTC, leave encashment, workmen compensation free issue for gas etc. paid to the employees have been taken as direct expenditure and the actual provision of gratuity allocated to the mine is treated as mine overhead and appointed on the basis of men on roll. The area overhead have been a[[prto9oned on the basis of production as per the procedure. Thus the total cost of production is ascertained by way of allocation of direct expenditure and apportionment of overhead costs booked through various cost centers. The expenditure thus ascertained is dived with the production to arrive at the cost of production per tone. The profit/ loss is the difference between the average sales realization plus surface transport charges and total cost of production. The preformed of existing cost sheet is felt adaptable to other underground machine mining technologies and as such the same is retained. The cost of production is to be ascertained for a technology as a profit center and all the costs are ascertained accordingly. To introduced the system of cost booking to the cost centers technology wise it is sought to ascertain the expenditure right from the basic documents of expenditure Without considering manual information.

47

According the manpower at the mines on allocation and apportionment to the respective technology with shall be grouped under the technology bio energies attendance shall be maintained and

designed cost centers and the

furnished accordingly so that wages cost can be directly obtained for each technology through the wage summaries from payroll programs. The indirect cost involving wages, stores and other expenditure booked to the respective cost centers shall be appointed ion the basis of production and the adopted base as is dine in the case of apportionment of overhead cost to the mines.

48

Specimen of cost sheet or statement of cost:

Particulars

Total cost (Rs.)

Cost per unit(Rs.)

DIRECT MATERIALS

XXX

XXX

DIRECT LABOUR

XXX

XXX

DIRECTT CHANGEABLE EXP:

OR XXX XXX

PRIME COST ADD: WORK OVERHEADS WORKS COST ADD: ADMINISTRATION HEADS OVER XXX XXX XXX XXX

COST OF PRODUCTION ADD: SELLING DISTRIBUTION HEADS AND OVER XXX XXX

TOTAL COST OF COST OF SALES

49

Wages to cost of production YEAR S 2007-08 2008-09 2009-10 2010-11 2011-12 TOTAL WAGES 10,919.31 9,127.47 8,463.42 10,758.20 10,355.01 TOTAL COST 23,393.50 22,786.71 18,159.05 23,911.00 35,679.07 PERCENTAGE 46.67 40.05 46.60 44.99 29.02

Source from annual report of G.B.P.L.

50 45 40 35 30 25 20 15 10 5 0

2007-08

2009-2010

2011-12

50

Interpretation:
The wages to cost of production ratio is fluctuating from year to year. (in year 2007-08 the wages to cost of production ratio is 46.67% and in the year 2011-12, it is decreased to 29.02%.).so their is a decline is total wages amount It very low in the year 2011-12 and in is very high in year

is the year 2011-12. 2007-08.

51

Stores to cost of production

YEAR S 2007-08 2008-09 2009-10 2010-11 2011-12

TOTAL WAGES 3595.61 1409.63 1253.2 2743.33 6654.27

TOTAL COST 23393.50 22786.71 18159.05 23911.00 35679.07

PERCENTAGE 15.37 6.19 6.90 11.47 18.65

20 15

10
5 0 2007- 2008- 2009- 2010- 201108 09 10 11 12

Source from annual report of GBPL Interpretation: The stores to cost of production ratio is fluctuating from year to year . (In the year 2007- 08)the stores to cost of production ratio is 15.37%, and in the year 2011-12.it is increased to 18.65%). So there is a decline is total stores amount in the year 2009-10. it very high in the year 2011-12 and very low in the year 200809

52

YEAR S

TOTAL

OTHER TOTAL COST OF PERCENTAGE% PRODCTION

EXPENCES

2007-08 2008-09 2009-10 2010-11 2011-12

8878.58 12249.60 8442.43 10409.49 18669.79

23,393.50 22,786.71 18,159.05 23,911.00 35,679.07

37.97 53.75 46.49 43.53 52.32

Other expanses to cost of production

60 50 40 30

20
10 0 2007-08 2008-09 2009-10 2010-11 2011-12

Source from annual report of G.B.P.L

Interpretation:
The other expanses to cost of production ratio is fluctuating from year to year.( in the year 2007-08 other expanses to cost of production ratio is 37.95% and in the year 2011- 12 is increased to 52.32% ). So there is a increase is total other expanses amount in the year 2011-12. it very in the year2010-11, and very low in the year 2007-08.

53

Total cost of production and trend analysis YEARS TOTAL COST OF TREND ANALYSIS%

PRODUCTION 2007-08 2008-09 2009-10 2010-11 2011-12 23,393.50 22,786.71 18,159.05 23,911.00 35,679.07 100.00 97.41 77.62 102.2 152.52

160 140 120 100 80 60 40 20 0 2007-08 2008-09 2009-10 2010-11 2011-12

Source annual report of G.B.P.L.

Interpretation:
The trend analysis to cost of production ratio is fluctuating from year to year.( in the year . 2007-08 the trend analysis to cost of production ratio is 100% and in the year 2011-12. It is increased to 152.52%). So there is increase in total trend analysis amount is the year 2010-11. it very high in the year 2011-12. it very low in the year 2009-10.

54

Total cost of production to total sales Years Total cost of Total sales Percent (%)

production 2007-08 2008-09 2009-10 2010-11 2011-12

140 120 100 80 60 40 20 0

23,393.50 22,786.71 18,159.05 23,911.00 35,679.07

21424.94 18249.94 24738.83 24520.91 34988.93

109.19 124.86 73.40 97.5 101.97

2007-082008-092009-102010-112011-12

Source from annual report of GBPL Interpretation: The total sales to cost of production ratio are fluctuating from year to year. ( in the year 2007-08 the total sales to cost of production ratio are 109.19% and in the year 2011-12, it is decreased to 101.97%). So there is a decline in total sales amount in the year 2011-12. It very high in the year 2008-09, and very low in the year 200910.
55

Profit/loss to total sales Year 2007-08 2008-09 2009-10 2010-11 2011-12 Profit/loss 1968.56 4536.77 6579.78 609.91 690.14 Total sales 21424.94 18249.94 24738.83 24520.91 34988.93 Percentage(%) 9.19 24.86 26.60 2.48 1.97

30 25 20 15 10 5 0

Source from annual report of GBPL Interpretation: The profit/loss to total sales ratio is fluctuation from year to year .(in the year 2007-08 the total profit/loss to total sales ratio is 9.19%, and in the year 2011-12 , it is decreased to -1.97 % ). So there is decline in total profit/loss amount in the year 2011-12. it very high in the year 2009-10,and very low in the year 2010-11.
56

Proportion expenses to total cost Year Wages (in %) Stores (in %) Other expenses Total cost (in %) (in %) 2007-08 2008-09 2009-10 2010-11 2011-12 46.67 40.05 46.60 44.99 29.02 15.37 6.19 6.90 11.47 18.65 37.97 53.75 46.49 43.53 52.32 100 100 100 100 100

60 50 40 30 20 10 0 2007-08 2008-09 2009-10 2010-11 2011-12

Source from annual report of GBPL

57

Interpretation:
1.The wages to cost of production ratio is fluctuating from year to year. (in year 2007-08 the wages to cost of production ratio is 46.67% and in the year 2011-12, it is decreased to 29.02%.).so their is a decline is total wages amount is the year It very low in the year 2011-12 and in is very high in year 2007-08.

2011-12.

2.The stores to cost of production ratio is fluctuating from year to year . (In the year 2007- 08)the stores to cost of production ratio is 15.37%, and in the year 2011-12,it is increased to 18.65%). So there is a decline is total stores amount in the year 2011-12. it very high in the year 2011-12 and very low in the year 200809 3.The other expanses to cost of production ratio is fluctuating from year to year.( in the year 2007-068other expanses to cost of production ratio is 37.95% and in the year 2011- 12 is increased to 52.32% ). So there is a increase is total other expanses amount in the year 2011-12. it very in the year2010-11, and very low in the year 2007-08

58

FINDINGS

The wages to cost of production ratio is fluctuating from year to year. (in year 2007-08 the wages to cost of production ratio is 46.67% and in the year. The stores to cost of production ratio is fluctuating from year to year . (In the year 2007-08)the stores to cost of production ratio is 15.37%, and in the year. The other expanses to cost of production ratio is fluctuating from year to year.( in the year 2007-08 other expanses to cost of production ratio is 37.95% and in the year. The trend analysis to cost of production ratio is fluctuating from year to year.( in the year 2007-08 the trend analysis to cost of production ratio is 100% and in the year. The total sales to cost of production ratio is fluctuating from year to year .( in the year 2007-08 the total sales to cost of production ratio is 109.19% and in the year. The profit/loss to total sales ratio is fluctuation from year to year .(in the year 2007-08the total profit/loss to total sales ratio is 9.19%, and in the year.

59

CONCLUSION The performance in maintenance the operating cost of the organization is good. This shows the healthy of financial strength of organization. The under ground expanses are year to year increased so those expenses try to minimize that. Other expanses are increased from year to year. This situation can be avoided by increasing the sales. The management is to minimize the operating cost expenditure to the extent possible to decrease the net profit ratio, which is very low. The management of GBPL. has to examine efforts to increase the net profit ratio in the same way as achieved better results in case of gross profit. From the frame conclusion it is recommended to GBPL are expressed their comments as follows. The GBPL is production oriented public ltd company the sales price of based on the financial viability and as well as the government policies. The GBPL has no freedom in fixation of purchase prices of the business. The main objective of the GBPL is to viable the bio energies selling rate to the extent possible. With regard to Net profit, it is concluded that it is the internal efficiency gains of the management against the expected targets fixed by the GBPL Hence the un favorable factors referred under the conclusion at Sl.No.3, 4, 5 may be negligible.

60

BIBLIOGRAPHY
1) FINANCIAL MANAGEMENT 2) FINANCIAL MANAGEMENT 3) FINANCIAL MANAGEMENT ------------I.M.PANDEY S.N.MAHESHWARI PRASANNA CHANDRA 4) MANAGEMENT ACCOUNTING ----KHAN & JAIN

5) MANAGEMENT ACCOUNTING

-----

R.K. SHARMA & SHASHI K GUPTA

Websites: www.gowthamihyd@gowthami.com www.gowthmikmm@redifmail.com

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