AURO UNIVERSITY OF

HOSPITALITY AND MANAGEMENT

A PROJECT ON
Management Accounting
MBA
Block 2 SEM-1
Individual Paper
Made by: Pawan Jariwala
(MBA 14-16)
Submitted to: Meghna Dangi
(Module leader)

ACKNOWLEDGEMENT
I take this opportunity to express my profound gratitude and deep
regards to my guide (Mrs. Meghna Dangi) for her exemplary
guidance, monitoring and constant encouragement throughout . I
am obliged to my batch mates for the valuable information
provided by them in their respective fields. I am grateful for their
cooperation during the period of our assignment Euro India Fresh
Foods Pvt Ltd.

Pawan
Jariwala.

Topics
Table

Introduction
Company Profile
Vision &Mission
Products Manufactured
Lists of Costs
Break Even
Budgeting Technique
Cost Control Technique
Purchase Department
Production Department
Conclusion
Reference

Contents

Of

Introduction :

It was the brainchild of Late Shri Jivanbhai Sansapara who was

the head Sahil Star Group, a company that deals in
manufacturing, exporting and importing diamonds, that helped
create a brand of FMCG snacks and juices named Euro India Fresh
Food Pvt Ltd. The company is now looked after by his kin, Mr.
Manhar J. Sanspara, Mr. Dinesh J. Sanspara, Mr. Jayanti J. Sanspara
and Mr. Mahesh V. Mavani.
The founders of Euro India Fresh Foods Pvt. Ltd. are also into the
business of real estate in the state of Gujarat, India.
Euro India Fresh Foods Pvt Ltd. is an Indian based snack food
manufacturer. The products manufactured by us are tailor made
to suit the Indian palate. Our product ranges from a wide variety
of flavored chips to beverages. Some of our products include,
Euro Chips, Euro Namkeens, Euro Getmore, Euro Wheels,
packaged drinking water Euro Spa, Euros mango drink Fresho and
lemon based drink Euro Lemoni.

Here at Euro, we ensure that we make snack foods as healthy as

possible. Refer to the Health Funda page to see how we are a
healthier option as compared to the rest. Euro India Fresh Foods
Pvt Ltd. is an ISO 22000:2005 certified organization which is
swiftly capturing the market. We hope to become a leading FMCG
company with the snacks, mineral water & fruit juices that we
manufacture.
We have also collaborated with Walt Disney and brought out
snack foods that will make the kids go crazy. They include Euro
Ringoli, Euro Bubbles and Euro Funfill. Whats more is, each of
these packets have a little surprise in the form of attractive
collectibles which will definitely appeal to children.

Company Profile:
Mr. Manhar J. Sanspara CMD (Chairman and Managing
Director)
Mr. Dinesh J. Sanspara MD (Managing Director)
Mr. Jayanti Sanspara (Executive Director)
Mr. Mahesh Mavani (Director)
Dr. Mukesh Navadiya (CEO)

Mr. Manhar J. Sanspara CMD (Chairman and Managing

Director)
Founder of Sahil Star Group and Chief Managing Directors in Euro
India Fresh Food Pvt. Ltd. has gained 25 years of experience in
diamond industry. At present he is involved in strategic business
decisions pertaining to his FMCG Company and also looks after
the overall management of the group along with manufacturing of
diamonds. He is also committed to social responsibilities by way
of various Medical. Educational & many other Trusts
Mr. Dineshbhai Jivanbhai Sanspara (MD)
Young, energetic and talented personnel designated as both
partner of Sahil Star Group and Managing Director in Euro India
Fresh Food Pvt. Ltd. He has also gained experience of more than
20 years in diamond industry and handles overseas buyers of
diamonds and finance department in the group. He aims at
making Euro India Fresh Food Pvt. Ltd. top FMCG player.
Mr. Jayantibhai Sanspara (Executive Director)
He has been controlling and executing his role as the Executive
Director of Euro India Foods from Belgium Known for his
enthusiastic and energetic approach towards work also has his
control over the proceedings of JR DIAM. He, with his qualified &
capable expertise has taken the charge of both the ventures
flawlessly.
Mr. Mahesh Vallabhai Mavani (Director)

He is designated as both partner of Sahil Star Group and Director

at Euro India Fresh Food Pvt. Ltd. Having attained 15 years
experience in Diamond Industry he is all set to use his expertise in
making Euro India Fresh Food Pvt. a leading FMCG company.
Dr. Mukesh Navadiya (CEO)
Having passed his BAMS from Gujarat Ayurveda University,
Jamnagar he is also practicing doctorate and is now associated
with Euro India Fresh Food Pvt. Ltd. as its Chief Executive Officer.
He takes care of all the workings of the company and
implementation of the project.

Vision and Mission:

Vision
To be one of the leading brands in FMCG industry
To be the most innovative company in the business
To make hunger satisfying products for every class of buyers
To be ranked highest in taste and varieties

Mission:
To make products that deliver value for money
To keep on delivering, mouth savoring healthy snacks and
beverages for years to come
To grant premium quality products and receive customer
satisfaction

Products Manufactured:
Euros Chips are fresh and crispy snack foods. They are made by selecting similar
sized potatoes of finest quality which are first taken for wash and later for
manufacturing process. Throughout the manufacturing process chips are
untouched as it is made using modern manufacturing techniques. Even the
packaging process is fully automated and each packet is nitrogen filled to ensure
that the chips stay fresh and crispy for longer period of time. The variety of
flavors manufactured by us focuses to satisfy Indian palate. Have a look at the
range of potato chips that we offer at Euro Fresh Foods Pvt Ltd.

Chilli Achar
Onion

Classic Salted

Cream

Masti Masala
Pepper Attack

Mint Lemon

Tingling Tomato

Euro Namkeen:
Have a few guests or just want to pick something, to munch on?
Want to serve some munchies with drinks? Nothing better that
serves you better than some few quick bites of Euro Namkeens.
From something that is spicy to something sweet , that leaves a
lasting taste. The varieties promise everything you need to
delight yourself or your guests. We serve in a wide range of
flavored Namkeens including: Chana Dal, Aloo Cheese Sev,
Bikaneri Bhujia, Tasty Peanuts, Shahi Mixture, Moong Dal,
Navratan Mixture, Khatta Meetha, Aloo Tomato Sev, Aloo Pudina
Sev, and Ratlami Sev.
Chana Dal
Bhujia

Aloo Cheese Sev

Bikaneri

Tasty Peanuts
Moong Dal

Navrati Mixture
Tomato Sev

Shahi Mixture

Khatta Meetha

Aloo

Aloo Pudina Sev

Ratlami Sev

Euro Farali:
Euros Farali is a category that has been introduced particularly
for those Indians that observe religious fasts or for those who
would like to have some diet food. These products are made with
a tinge of Sindhav Salt added to them, thus making them
suitable for fast observers. The array of Farali products include,
Potato Wafers, Kela Wafers, ChiwdaTikha, Chiwda Mitha.
Chiwda Meetha
Wafers

Potato Wafers

Kela

Chiwda Tikha

Euro Disney:

Euro collaborated with Walt Disney to pamper the kids with

yummy snacks and exciting goodies. Funfill caters to the taste
buds of children with its creamy fillings. These are corn filled
snack with cream filling which are healthy for children as they are
baked and not fried. Funfill is a unique delicacy that has been
introduced in the family of snack foods. Each packet has a little
collectible inside that will cheer the kids up and make them want
more. So do not miss the chance to see your kid smiling after he
or she opens this packet. We have four flavors that will make kids
go gaga over it. They are: Chocolate, Strawberry, Vanilla, BlackCurrent.

Black Current

Funfill Strawberry

Funfill Chocolate

Funfill Vanilla

Ringoli:
Ringoli from Euro is a different kind of snack, a snack with a hole!
Every bite will give you a crispy and crunchy experience
accentuated with its unique flavor. We offer these rings in three
flavors: Cheese Rings, Masala Ring, Tomato Rings.
Euros Bubbles is another product that we have made for the kids.
Its creative 3D packaging attracts the children even more. They

are light, flavored balls that are difficult to stop munching once
you start. Its crunchy sound echoes in your ears and lures you to
get some more. So waste no time and juggle some in your hand
and some on your tongue. These balls are available in three
flavors, namely: Cheese balls, Masala balls, Tomato balls
Tomato Rings

Bubble Cheese

Balls

Extruded Snacks:

Cheese Rings

Masala Rings

Masala Ball

Tomato

Euros Getmore is tastier, crispier and yummier of all the extruded

snacks available. Every crispy crunchy bite will surprise you with
its extraordinary taste. All these crispy chips have been
manufactured with utmost care and under very hygienic
conditions. These flavours are very different and will make it
tough for you to resist. Each time you finish a packet, you would
feel like running to the store to GETMORE. The flavors that we
offer in Euro Getmore are: Tingling Tomato, Chatpata Masala,
Green Chutney

Green Chatni

Tingling Tomato

New Upcoming Try Angles

EURO Magic Funfill is the unique delicacy introduced for the very
first time in the family of Snacks Food. A great mishmash of Corn
Pillows with Delightful Crme inside. This amazing snack is one of
its kinds. The crme is extracted from choicest of mangoes &
strawberries to give a very original and Fresh Taste. Every bite of
it will take you to the tour of creamy delight.
Achaare Masti

Chilli Masti

Tomato Twist

New Up Coming Flippe Puff:

EURO Flippe Puff is the unique delicacy introduced for the very
first time in the family of Snacks Food. A great mishmash of Corn
Pillows with Delightful Crme inside. This amazing snack is one of
its kinds. The crme is extracted from choicest of mangoes &
strawberries to give a very original and Fresh Taste. Every bite of
it will take you to the tour of creamy delight.
Tomato Punch
Onion

Chatpata Pudina

Butter Chaska

Cream n

King Corn:
EURO Magic Funfill is the unique delicacy introduced for the very
first time in the family of Snacks Food. A great mishmash of Corn
Pillows with Delightful Crme inside. This amazing snack is one of
its kinds. The crme is extracted from choicest of mangoes &
strawberries to give a very original and Fresh Taste. Every bite of
it will take you to the tour of creamy delight.

Sausy Tomato
Nachos Cheese

Sweet Chilli

Beverages:
The thirst for water cannot be replaced by any other drink.
Keeping that in mind and also ensuring that you get safe healthy
drinking water wherever you are, Euro has come up with a bottle
of packaged drinking water called, Spa. The water is bottled after
a series of purification and sterilization processes, hence making
it very safe to drink. Spa goes through the state of the art
purification process to ensure that consumers get pure and

hygienic drinking water. The process of purification is done

through five steps that include:
1)

UV Treatment

2)

Reverse Osmosis

3)

Ozonisation

4)

Carbon Filtration

5)

Sand Filtration

Our bottled water has an ISI mark issued by the Bureau of Indian
Standards. Hence, the next time you feel thirsty, go get yourself a
chilled bottle of Euros Spa drinking water.

Guava

Litchi
Spa

Fresho

Health Funda:

All the products are 100% vegetarian

Prepared in less oil
No Artificial Colours, Monosodium Glutamate (MSG) and

Gelatinare added to the products

0% Cholesterol

0% Trans Fat Acid

No trace of Genetically Modified Organisms Certified GMO

FREE

Our products are approved by Food Safety and Standards

Authority of India (FSSAI)

Euro India Foods Pvt Ltd. is an ISO 22000:2005 certified

organization
State of the art manufacturing unit
Stringent Quality Control
Hygienic Conditions
Nitrogen filled packaging to maintain freshness

LIST OF CUSTOMERS
Big Bazaar
Dhiraj Sons
General & Provisional Stores
LIST OF COMPETITORS

Euro Foods
Uncle Chips
Parle Agro
Balaji
Other local brands

LIST OF COSTS WITH CLASSIFICATION

Cost Classification

Manufacturing Costs

Direct
Material

Direct Labor
Manufacturing Overhead

Non- Manufacturing Costs

Selling
Costs

Administrative Costs

Fixed Manufacturing Overhead

Variable Manufacturing Overhead

Manufacturing Costs:
Manufacturing cost is the expenditure incurred
in carrying out the production processes of an organization.

The manufacturing cost includes direct costs, for example,

labor, materials, and expenses, and indirect costs, for example,
subcontracting and overheads. The costs identified as
manufacturing costs are as follows:

1. Direct Materials:
The materials that go into final product are called raw materials
Potato
Oil
Seasoning (Flavor)
Film (packet)
Carton

2. Direct Labor
The term direct labor is reserved for those labor costs that
can be essentially traced to individual units of products.
Direct labor is sometime called touch labor, since direct
labor workers typically touch the product while it is being
made. Direct labor includes worker working in
Input Department
Peeling Department
Washing Department
Slicing Department
Frying Department
Seasoning Department
Packaging Department

3. Manufacturing Department
Manufacturing overhead, the third element of manufacturing
cost, includes all costs of manufacturing except direct material
and direct labor. Variable manufacturing overheads includes

Electricity
Gas (gas generator)
Nitrogen (N2) flush
Utility expenses
Repairing costs
Maintenance costs

Fixed manufacturing overheads includes

Rental costs (if gas generator is hired on rent)

Transportation costs
Meals
Depreciation

Indirect labor includes

Labor used in service department

Security guards
Labor in engineering department
Warehousing Labor
Labor in quality department
Overtime

Indirect materials includes

Food Stickers

Non Manufacturing Costs

Non manufacturing costs are those costs that are not incurred to
manufacture a product. Examples of such costs are salary of
sales person and advertising expenses. Generally non
manufacturing costs are further classified into two categories
1. Marketing and Selling Costs
2. Administrative Costs
1. Marketing and Selling Costs
Marketing or selling costs include all costs necessary to
secure customer orders and get the finished product into
the hands of the customers. These costs are often called
order getting or order filling costs. These costs include;
Commissions
Placement costs
Transportation costs (per unit of product is charged)
2.

Administrative costs

Administrative costs include all executive, organizational,

and clerical costs associated with general management of an
organization rather than with manufacturing, marketing, or
selling. Examples of administrative costs include executive
compensation, general accounting, secretarial, public relations,
and similar costs involved in the overall, general administration of
the organization as a whole. For PepsiCo, Snacks department
following costs are identified as its administrative costs;
Salaries
Office expenditure including furniture and stationery costs
Depreciation costs (offices)
Cost Classification on the basis of cost behaviour:

Apart from classifying costs as manufacturing and nonmanufacturing costs, costs are also classified on the basis of
their behaviour. These are the
Variable costs
Fixed costs
1. Variable Costs
Variable cost is a cost that varies, in total, in direct proportion to
changes in the level of activity. The first is electricity cost. The
electricity is generated from gas generators so the gas will also
be considered as a variable cost.
2. Fixed Costs
Fixed Cost is a cost that remains constant, in total,
regardless of changes in the level of activity within the
relevant range. Second is the cost of the permanent staff.
The transportation cost i.e. cost of transporting potatoes
from the arm to plant and then from the plant to warehouse is
also considered as a fixed cost. The rental cost e.g. of
the generators that are used to generate electricity is also
fixed cost.
OTHER COSTS
Other costs include the fringe benefits and the extra benefits
given to the employees. Fringe benefits are perks offered to
employees in order to keep them motivated and for the purpose
of retaining them.
Fringe benefits given to labour include
Meal

 Transportation
Overtime
Extra benefits to higher executives includes (varies with status)
Pay roll
Provident fund
Medical free facility
Transport
Fuel expense
Cell phones (monthly bill of cell paid)

BREAK EVEN
Fixed Cost = Rs. 10, 00, 00, 000
Desire Profit = 12.5%
Sales to Earn Desired Profit = 85, 00, 00, 000
Sales to Earn Desired Profit = (Fixed Cost + Desire Profit) / P.V.
Ratio
(P.V. Ratio = 24%)
BEP = Fixer Cost / P.V. ratio
= 10, 00, 00, 000 / 0.24
= Rs. 41, 66, 00, 000

BUDGETING TECHNIQUES AT EURO FOODS

A budget is a plan expressed in rupee amounts that acts as a road
map to carry out an organizations objectives, strategies and
assumptions.
A company might have a master budget or profit plan for the
upcoming year. The master budget will include a projected
income statement and balance sheet. Within the master budget
will be operating budgets such as a sales budget, production
budget, marketing budget, administrative budget, and budgets
for departments. In addition there will be a cash budget and a
capital expenditures budget.
It is a common practice that the budgets prepared for the next
accounting year will be detailed by quarter or by month. It is also
typical that the annual budget will not be changed once the
actual year begins. For managers, a budget is a guide that it not
so rigid that it prevents timely action when needed. In rare
circumstances the annual budget might be revised, but only when
the business environment has radically changed.

OPERATING BUDGET APPROACH

The company uses the operating budget approach in which the

budget is made for the whole year i.e. 12 months from January to
December which is reviewed almost every month but it is not the
rolling one to check if there are some variances there are
afterwards corrected according to the current situation.
PARTICIPATIVE BUDGETING APPROACH
The company also uses self-imposed budgeting or participative
budgeting approach in which they ask all the managers from
different departments to give their requirements and allocate
costs

to

their

requirements

then

these

requirements

are

overviewed by administration for budgeting. For instance, plant

manager are consulted for all the overheads because later it
becomes very difficult to knock down the whole process.
BUDGETING COMMITTEE
Budgeting committee is divided into
Control committee
Planning committee

COST CONTROL TECHNIQUES

1. PURCHASE DEPARTMENT
a) They buy potatoes in bulk, once in a year when prices
are low, thereby reducing the cost.

b) Most of the machinery (80%) has been purchased that

have been manufactured in India and only 20% of it
has been bought from China.
c) They also resort to bulk buying techniques for all raw
materials that they use in the manufacturing process.
d) They manufacture the pet bottles in-house (bottles
used in juice bottles), thus are able to cut back on their
purchase expenses.
e) One of the techniques used by the company to reduce
its costs includes Opportunity Buying, i.e. they buy in
bulk when the market prices of the raw materials that
they require are the lowest and maintain a huge stock
of the items.
2. PRODUCTION DEPARTMENT
a) The company has substituted lower cost material
wherever possible in their production line so as to bring
down the overall cost of production of potato chips,
without compromising on the quality.
b) Euro Foods Ltd. has been able to reduce their overall
wastage to a great extent which has helped them to cut
back on their expenses.
c) The company makes optimum utilization of its labor
force by offering them on the job training, this
enhancing their efficiency. This helps the company to
operate with bare minimum workers, thus avoiding the
cost of idle labor.
d) The company has employed the latest and most
updated

machinery

in

its

production

line,

hence

leveraging upon the economies of scale reducing the

cost.
e) The company confirms regular maintenance of all
machinery, thereby preventing any breakdowns and
ensuring smooth functioning of the entire process. An
uninterrupted production line is thus able to minimize
the overall cost structure.

CONCLUSION
Euro India Fresh Foods Pvt. Ltd. may be a new player in town, but
it is growing in leaps and bound. Started in 2011, the company
has come a long way since then. Today the company is well
known for its extensive product line and the quality that it offers.
The company offers best quality products at the lowest market
rate, owing to its highly capital intensive production process
which is equipped with the state-of-the-art machinery which
ensures a smooth functioning of the entire operation. The cost
cutting techniques adopted by the company have worked out well
so far, enabling it to offer high quality products at low prices. The
company has major expansion plans in the near future and
aspires to become a national brand within a decade. Considering
the current scale of operations, if the company continues on the
same path, it has a very bright foreseeable future ahead.

REFERENCES
Euro India Fresh Foods Pvt. Ltd.. 2014. Euro India Fresh Foods
Pvt. Ltd.. [ONLINE] Available at: http://euroindiafoods.com/.
[Accessed 27 November 2014].