case study on giberson glass studio
DESCRIPTION
Giberson is well known in making different types of glasses.TRANSCRIPT
PRESENTED BY:- GROUP NO. A5
Chandan Pahelwani (11047) Himani Parihar (11049) Nikita Bali (11004) Sonia Dadlani (10022) Sunny Bhuva (11010)
Presented to:-Prof. Deepa Mishra
GIST OF THE CASE
Giberson is well known in making different types of glasses.
Felicia coates,an MBA student visiting giberson’s glass studio.
She shadows upon financial statement of giberson’s which were previously taken care by Mrs.giberson which was neglected after their divorce.
CONT…..
The main key concern point is that Giberson has no pricing strategy for the production.
His financial position is deteriorating.
PROBLEM
Book keeping Need of additional resources . No pricing strategy. Rapid deterioration of financial
position.
SWOT ANALYSIS
• Quality• Sales• Orders
• Extra cost(labour)
• Operating cost• Need of
additional financing
• Life span of facilities
• EnvironmentaIssues
• Loosing customers
• Trade shows• Informational
technology
Strength Weakness
Threats Opportunity
OPERATING COST
Item Cost per month Months Operating
CostsOffice Supplies $ 25 10 $ 250 Hand Tools/Manufacturing Supplies $ 150 10 $ 1,500 P/T Labor($5/hr) $ 100 10 $ 1000 Other Operating Costs $ 640 12 $ 7,680 Truck $ 205 12 $ 2,460
Furnace (GAS) $ 1,000 10 $10,000
Depreciation on Furnace (2 Years) $ 208 12 $ 2,500
Depreciation on Equipment (8 Years) $ 31 12 $ 375
Depreciation on Truck (5 Years) $ 142 12 $ 1,700
Depreciation on Gas Tanks (8 Years) $ 4 12 $ 50
Salary $ 2,083 12 $
25,000 TOTAL $ 52,515
TOTAL ANNUAL REVENUE
Category Unit Price #Units Sales
Pattern Glass $9 760 $6,840
Paperweights $15 400 $6,000
Wrapped Tumblers $8 1280 $10,240
Vases $25 320 $8,000
Total Annual Revenue $31,080
Revenue
Annual Loss
-
- =-
- =
$31,080
COGS(materials)
Operating Expense
Net Loss
$857 $52,515 - 22,292
ACTION PLAN
To find the relevant cost batch wise so that he can gains minimum margin profit.
Also he should maintain the books of accounts.
MATERIAL BATCH WISE COST
Cost per batch = 21.42
Total lbs. = 169
If Increase material used to 200 batch then
169 - - - 21.42
200 - - - - ?? = 25.35
Cost\Batch
Total work done in week
Total Cost
Old 21.42 40 weeks 856.8
New 25.35 40 weeks 1014
DECISION
To prepare the books of accounts. To evaluate cost as per batch because
they are doing batch wise costing.
CONTINGENCY PLAN
To increase the cost batch wise so that profit can be easily maintained.
Reduce the units in batch and keep the price same so that actual gain can be done.