Price Output Relationship in Ice Market Final

8/8/2019 Price Output Relationship in Ice Market Final

1/13

PRICE OUTPUTRELATIONSHIP IN ICE

MARKET


2/13

COMPANYS PROFILE

Name - Kanpur Ice Factory & Cold Storage

Proprietor - Mr. Arun Sharma

Location-Bans Mandi,Kanpur It was established in 1961.

Ice Plant capacity is 15tonnes.


3/13

INPUTS USED IN PRODUCTION

RAW MATERIAL-It Includes following;

1. Power

2. Water3. Ammonia

4. Salt

LABOUR-

1. Plant engineer(one)2. Operator(one)

3. Helpers(three)

4. Tank man(six)

MACHINERY-1. Compressor

2. Condenser

3. Cooling coil4. Ice cans

5. Crane


4/13

COST OF PRODUCTION

INPUTS COST PER ICE CUBE

(1ICE CUBE=120KG)

Power [email protected] =70

Water+Ammonia+Salt 13

Labour 7

Total Cost 90


5/13

FACTORS AFFECTING COST OF

PRODUCTION RAW MATERIAL

LABOUR

POWER MACHINERY


6/13

HOW ICE IS MANUFACTURED?

They have their own source of water collected intank.

Filtration of water is done with bleaching powder.

Ammonia is flushed into compressor for maintainingPressure and Volume .

Then it is send to condenser coil.

With the help of chill water ammonia is cooled .

Then it is send to cooling coils to freeze the ice Some amount of salt is added to to decrease the

freezing point in Ice can.


7/13

HOW ICE REACH CUSTOMERS?

MANUFACTURER

RETAILERS

CUSTOMERS


8/13

DEMAND OF ICE VARIES IN SEASON

Month Qty.demanded

(in cans)

January 1200

February 1350

March 2700

April 4050

May 5250

June 5100

July 4200

August 3750

September 3900

October 3300

November 2400

December 1500

DEMAND OF ICE

0

1000

20003000

4000

50006000

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Months

Qty.

demanded(in Series1


9/13

Monthly Sales, Total Cost, Total Revenue &

Profit

Month No.of

units

Unitssold per

month

FixedCost

(FC)

Costof

labour

(VC)

Costper unit Totalcost

(TC)

MarketPrice

(P)

TotalRevenu

e (TR)

Profit(TR-TC)

Jan. 40 1200 70 20 90 108000 150 180000 72000

Feb. 45 1350 70 25 95 128250 150 202500 74250

Mar. 90 2700 70 40 110 297000 150 405000 108000

Apr. 135 4050 70 50 120 486000 150 607500 121500

May 175 5250 70 55 125 656250 150 787500 131250

Jun. 170 5100 70 55 125 637500 150 765000 127500

Jul. 140 4200 70 50 120 504000 150 630000 126000

Aug. 125 3750 70 45 115 431250 150 562500 131250

Sep. 130 3900 70 45 115 448500 150 585000 136500

Oct. 110 3300 70 40 110 363000 150 495000 132000

Nov. 80 2400 70 35 105 252000 150 360000 108000

Dec. 50 1500 70 25 95 142500 150 225000 82500


10/13

TOTAL COST & TOTAL REVENUE

0

200000

400000

600000

800000

1000000

Jan

Feb

Mar

Apr

Ma Jun

Jul

Au Sep

Oct

Nov

Dec

Month

Cost&

Reve

nue TOTAL COST

TOTAL REVENUE


11/13

PROFIT

0

50000

100000

150000

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov DecMonths

Pro

fit

PROFIT


12/13

AVERAGE TOTAL COST, MARGINAL COST

&MARGINAL REVENUE

Qty. of

workers

Qty. of

ice cubesproduced

Price

(P)

Fixed

Cost(FC)

Variable

Cost(VC)

Total

Revenue(TR)

Total

Cost(TC)

Average

TotalCost

(ATC)

Marginal

Cost(MC)

Marginal

Revenue(MR)

0 0 150 70 0 0 70 0 0 01 14 150 70 80 2100 150 10.71 5.71 150

2 32 150 70 110 4800 180 5.63 1.67 150

3 54 150 70 135 8100 205 3.80 0.88 150

4 70 150 70 145 10500 215 3.07 0.63 150

5 90 150 70 165 13500 235 2.61 1.00 150


13/13

The reference table of x-axis is shown below:

AVERAGE TOTAL COST,

MARGINAL REVENUE & MARGINAL

COST

0

10 0

20 0

1 2 3 4 5 6

Qty. of ice cubes

produced per day

Cost,Rev

&P

rofit

AVERAGE

TOTAL

COST

MARGINAL

COST

MARGINAL

REVENUE

1=14 2=32 3=54 4=70 5=90

Price Output Relationship in Ice Market Final

Documents