1. Boston Creamery Case Study
On variance for Profit planning and control systems

2. Participants
Neeta PaiB018
KishoriSawant B038
KavitaShetty B027
AlpanaPawarB039
Vishal Agarwal B001
Karan Mehta B015
3. Boston Creamery Case Study
Case 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 Study
Boston 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 ina favourable overall variance.
5. What is Variance

Comparison 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 -1
Jim Robertson- President
Frank Roberts- Vice President for Sales and Marketing
7. Draft submitted by Marketing VP
8. Act -2
Jim Peterson President
John Parker Vice President for Marketing and Operations
9. Draft submitted by Operations VP
Market 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 wrongforecasting = 99,000 80,700= 18,300
Proposed Growth in Market Share = 167600Variance = 167600 - 112567 = 55300 approx
10. Product Mix
11. Act-3
Jim Peterson President
Frank Roberts-Vice President for Sales and Marketing
John Parker Vice President for Marketing and Operations
John Vance (CPA)-Controller
12. Variance Analysis as per John Vance
13. Manufacturing Cost of Goods Sold
14. Recommendations
15. THANKYOU