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Boston creamery final

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Neeta Pai
Neeta Pai

This document summarizes a case study about Boston Creamery, an ice cream company that installed a new financial planning and control system to compare budgeted and actual results. The summary focuses on 4 key characters - the President, VP of Sales and Marketing, VP of Operations, and Controller. It provides background on the company and system, and describes how the VP of Operations and Controller analyze variances in areas like market growth, manufacturing costs, and product mix to identify issues and recommendations. The summary is intended to highlight the essential information about the case study in 3 sentences or less.

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Boston Creamery Case StudyOn variance for Profit planning and control systems
Participants Neeta Pai B018KishoriSawant B038KavitaShetty B027AlpanaPawar B039Vishal Agarwal B001Karan Mehta B015
Boston Creamery Case StudyCase deals with design and use of formal profit planning and control systems. It was originally set in an ice cream company in 1973, a few years before the advent of Designer Ice cream.Case Study revolves around four characters: Jim Peterson President Frank Roberts- Vice President for Sales and Marketing John Parker Vice President for Marketing and Operations John Vance (CPA)- Controller
Boston Creamery Case StudyBoston Creamery is an Ice cream Company which manufactures and distributes ice cream to wholesalers and retailers.A new Financial Planning and control system has been installed to compare budgeted results against actual results.The tool is used to highlight things that needed corrective actions or commend things that resulted in a favourable overall variance.
What is VarianceComparison between actual and budgeted performance.Variance can be Favorable or unfavorable.It helps to trace the origin and causes of unfavorable variances.Success of variance analysis depends on how quickly and effectively the corrective actions can be taken and analyzed.Calculation of variances is not an end in itself but means to the end.
Act -1Jim Robertson- PresidentFrank Roberts- Vice President for Sales and Marketing
Draft submitted by Marketing VP
Act -2Jim Peterson PresidentJohn Parker Vice President for Marketing and Operations
Draft submitted by Operations VPMarket Growth = STD Margin * (Budgeted Industrial Volume - Actual Industrial Volume ) * Market share.Market Growth = 0.4539 * (11440000-12180000) * 0.5 = 167600 (F)Market Share = STD Margin*(Budgeted Volume in liters -Actual Volume in liters) Actual Growth in Market Share = 0.4539 * (5720000 - 5968000 ) = 112567 Total Manufacturing cost = Budgeted Manu. Cost - Actual Manu. Cost = (99,000)Manufacturing cost deducting cost incurred by wrong forecasting = 99,000 80,700= 18,300Proposed Growth in Market Share = 167600 Variance = 167600 - 112567 = 55300 approx
Product Mix
Act-3Jim Peterson PresidentFrank Roberts- Vice President for Sales and MarketingJohn Parker Vice President for Marketing and OperationsJohn Vance (CPA)- Controller
Variance Analysis as per John Vance
Manufacturing Cost of Goods Sold
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Boston creamery final

  • 1. Boston Creamery Case StudyOn variance for Profit planning and control systems
  • 2. Participants Neeta Pai B018KishoriSawant B038KavitaShetty B027AlpanaPawar B039Vishal Agarwal B001Karan Mehta B015
  • 3. Boston Creamery Case StudyCase deals with design and use of formal profit planning and control systems. It was originally set in an ice cream company in 1973, a few years before the advent of Designer Ice cream.Case Study revolves around four characters: Jim Peterson President Frank Roberts- Vice President for Sales and Marketing John Parker Vice President for Marketing and Operations John Vance (CPA)- Controller
  • 4. Boston Creamery Case StudyBoston Creamery is an Ice cream Company which manufactures and distributes ice cream to wholesalers and retailers.A new Financial Planning and control system has been installed to compare budgeted results against actual results.The tool is used to highlight things that needed corrective actions or commend things that resulted in a favourable overall variance.
  • 5. What is VarianceComparison between actual and budgeted performance.Variance can be Favorable or unfavorable.It helps to trace the origin and causes of unfavorable variances.Success of variance analysis depends on how quickly and effectively the corrective actions can be taken and analyzed.Calculation of variances is not an end in itself but means to the end.
  • 6. Act -1Jim Robertson- PresidentFrank Roberts- Vice President for Sales and Marketing
  • 7. Draft submitted by Marketing VP
  • 8. Act -2Jim Peterson PresidentJohn Parker Vice President for Marketing and Operations
  • 9. Draft submitted by Operations VPMarket Growth = STD Margin * (Budgeted Industrial Volume - Actual Industrial Volume ) * Market share.Market Growth = 0.4539 * (11440000-12180000) * 0.5 = 167600 (F)Market Share = STD Margin*(Budgeted Volume in liters -Actual Volume in liters) Actual Growth in Market Share = 0.4539 * (5720000 - 5968000 ) = 112567 Total Manufacturing cost = Budgeted Manu. Cost - Actual Manu. Cost = (99,000)Manufacturing cost deducting cost incurred by wrong forecasting = 99,000 80,700= 18,300Proposed Growth in Market Share = 167600 Variance = 167600 - 112567 = 55300 approx
  • 11. Act-3Jim Peterson PresidentFrank Roberts- Vice President for Sales and MarketingJohn Parker Vice President for Marketing and OperationsJohn Vance (CPA)- Controller
  • 12. Variance Analysis as per John Vance