FINAL PROJECT. Cost Volume Profit Analysis at PT.Indofood Fritolay Makmur for Year Sigit Adrian Pambudi

FINAL PROJECT

Cost Volume Profit Analysis at PT.Indofood Fritolay Makmur for Year 2009

by

Sigit Adrian Pambudi

19007002

A Final Project in Partial Fulfillment

of The Requirement for the Degree of Bachelor of Mangement

Under Graduate Program of Management Study

School of Business and Management ITB

iii

APPROVAL PAGE

“Cost Volume Profit Analysis at PT.Indofood Fritolay Makmur for Year 2009”

by

Sigit Adrian Pambudi

19007002

A Final Project in Partial Fulfillment

of The Requirement for the Degree of Bachelor of Mangement

Under Graduate Program of Management Study

School of Business and Management ITB

2010

Approved by

i

ABSTRACT

PT.Indofood Fritolay Makmur is one of companies owned by Indofood. Indofood owned 51% share of PT.Indofood Fritolay Makmur while PepsiCo owned 49% of the total share. PT.Indofood Fritolay Makmur is a joint venture company between Indofood and PepsiCo. PT.Indofood Fritolay Makmur has produced many big names products such as Chitato, Lays, Chiki and Cheetos. PT.Indofood Fritolay has produced for more than 16.000 tons of product each year with revenue for more than IDR 800 billion. PT.Indofood Fritolay Makmur does not consider much about some of important aspects in cost accounting such as breakeven point and cost volume profit analysis. What they consider is the contribution margin. They think that if they can reach their expected contribution margin, they can easily reach the breakeven point and that’s why they do not consider a lot about the breakeven point.

The important theories that will be used in this research are the contribution margin, breakeven point and cost-volume profit analysis. Any cost theories that will be included is the cost behavior pattern which include the fixed and variable cost which is the main part of calculating the contribution margin, breakeven point and CVP analysis.

There are two things that influenced PT.Indofood Fritolay Makmur in setting up the price for its products. There are external and internal factors. PT.Indofood Fritolay Makmur have to sell for a total 9.838,75 tons of products.

PT.Indofood Fritolay wants to achieve a 10% growth for its net operating income in year 2010. By using the CVP analysis, PT.Indofood Fritolay Makmur has to sell for a total 17.254,33 tons of product to reach the targeted net operation profit in year 2010. By using the CVP analysis, PT.Indofood Fritolay Makmur can trace which product and in which months it needs to be improved to reach the targeted net operating profit. So, it is important using a cost accounting theory such as CVP analysis. It can help the company to make better planning.

ii

ABSTRAK

PT.Indofood Fritolay Makmur adalah salah satu perusahaan yang dimiliki oleh Indofood. Indofood memiliki 51% saham PT.Indofood Fritolay Makmur sementara PepsiCo dimiliki 49% dari total saham. PT.Indofood Fritolay Makmur adalah hasil dari penggabungan perusahaan antara Indofood dan PepsiCo. PT.Indofood Fritolay Makmur telah menghasilkan banyak produk bernama besar seperti Chitato, Lays, Chiki dan Cheetos. PT.Indofood Fritolay telah menghasilkan lebih dari 16,000 ton produk setiap tahun dengan pendapatan lebih dari Rp 800 miliar. PT.Indofood Fritolay Makmur tidak banyak mempertimbangkan tentang beberapa aspek penting dalam akuntansi biaya seperti titik impas (breakeven point) dan analisis biaya volume laba (CVP). Apa yang mereka anggap paling penting adalah margin kontribusi. Mereka berpendapat bahwa jika mereka bisa mencapai margin kontribusi yang diharapkan mereka, mereka dengan mudah dapat mencapai titik impas dan itulah mengapa mereka tidak mempertimbangkan banyak tentang titik impas.

Teori-teori penting yang akan digunakan dalam penelitian ini adalah margin kontribusi, titik impas dan analisis biaya-volume profit. Teori biaya apapun yang akan dimasukkan adalah pola perilaku biaya yang meliputi biaya tetap dan variabel yang merupakan bagian utama dari perhitungan margin kontribusi, titik impas dan analisis biaya-volume profit.

Ada dua hal yang mempengaruhi PT.Indofood Fritolay Makmur dalam menetapkan harga untuk produk-produknya. Ada faktor eksternal dan internal. PT.Indofood Fritolay Makmur harus menjual 9.838,75 ton untuk total produk pada tahun 2009. PT.Indofood Fritolay ingin mencapai pertumbuhan 10% untuk pendapatan operasional bersihnya di tahun 2010.

PT.Indofood Fritolay ingin mencapai pertumbuhan 10% untuk pendapatan operasional bersihnya di tahun 2010. Dengan menggunakan analisis biaya-volume profit, PT.Indofood Fritolay Makmur harus menjual 17.254,33 ton produk untuk mencapai laba operasi bersih yang ditargetkan pada tahun 2010. Dengan menggunakan analisis biaya-volume profit, PT.Indofood Fritolay Makmur akan dapat melacak produk dan pada bulan apa saja yang perlu ditingkatkan untuk mencapai laba usaha bersih yang ditargetkan. Jadi, adalah penting untuk menggunakan teori akuntansi biaya seperti analisis biaya-volume profit. Hal ini dapat membantu perusahaan untuk membuat perencanaan.

iv

FOREWORD

This paper is made based on the interest of the author in Cost Accounting. The

purpose of writing this paper is to learn more about the Cost Accounting in a

big company such as PT.Indofood Fritolay Makmur and also can be a reference

for academic. The purpose of this paper is also to fulfill the requirement of

School of Business and Management, ITB for the undergraduate program. This

paper can be finished with so many help from many people and the author

wants to say thanks for that many helps.

First, the author thank ALLAH SWT with the blessing, strength and hope given

to the author to finish this final paper.

The second is the author wants to thank his parents, Kemal Amas and Nunuk

Nuraini for their nonstop help and support so the author can finish his final

paper.

Next is the writer wants to thank his supervisor, Dra. Isrochmani Murtaqi,

M.Acc for her time, support, advice and patience that has been given to the

author. Without her, the author absolutely cannot finish his paper.

The author wants to say many of thanks to PT.Indofood Fritolay Makmur. It is a

pleasure to learn more and write a paper from a very big company such as

PT.Indofood Fritolay Makmur. Many thanks also given by the author to many

people in PT.Indofood Fritolay Makmur especially for Ms. Winarti T.K,

Mr.Sugeng, Mr.Budi, Mrs.Elly, Mrs. Henny, Mrs. Rochmani and Mr. Sandy.

Without their help, the author cannot get the required data to finish his paper.

They also give a lot of priceless lesson that can help the author to learn more

about a big company in the real world.

Next is the author wants to say thanks to his beloved grandmother, Soelasmiati

Soepardan for being a great role model for the author. The author learned a lot

of things from her that give him strength, spirit and own perspective to live his

life.

Many thanks also the author gives to his sister and brother, Ghina Raida Asilia

and Genaldi Rayhan Ardhito for their support and understanding that help the

author to finish his paper.

Last but not least is for all of his friends that give so many help to the author. A

special thanks is given by the author to Trixie Isabella Simatupang for her

unlimited support in enything, anytime anywhere.

v

LIST OF CONTENTS

ABSTRACT

i

APPROVAL PAGE

iii

FOREWORD

iv

LIST OF CONTENTS

v

LIST OF FIGURES

vii

LIST OF TABLES

viii

CHAPTER I INTRODUCTION

1

1.1. Background

1

1.2 Problem Identification

4

1.3. Scope of Limitation

5

1.4. Research Objectives

5

1.5. Chapter Outline

6

CHAPTER II LITERATURE STUDY

7

2.1. Cost Terminology

7

2.1.1. Cost-Behavior Patterns

7

2.1.1.1. Variable Cost

7

2.1.1.2. Fixed Cost

7

2.2. Unit Cost

8

2.3. Contribution Margin

8

2.4. Breakeven Point

9

2.4.1. Breakeven Point Analysis for Multiple Products

9

2.5. Cost Volume Profit (CVP)

10

CHAPTER III METHODOLOGY

13

3.1 Survey

13

3.2. Identified the Problem

13

3.3. Literature Study

14

3.4. Data Collection

14

3.5. Data Processing

14

3.6. Data Analysis

15

3.7. Conclusion

15

CHAPTER IV DATA ANALYSIS

17

4.1. Sales in unit

17

4.2. Variable Cost

20

4.3. Fixed Cost

22

4.4. Volume-Revenue

22

4.5. Pricing Strategy

23

4.5.1. Internal Factor

24

4.5.2. External Factor

29

4.6. Contribution Margin

32

4.7. Breakeven Point (Sales Mix)

33

vi

Chapter V CONCLUSION AND SUGGESTION

45

5.1. Conclusion

45

vii

LIST OF FIGURES

Figure 2.1. Breakeven point profit-volume graph

10

Figure 4.1 Sales graphic 2009

19

Figure 4.2 Chitato production flow

24

Figure 4.3 Lays production flow

25

Figure 4.4 Qtela production flow

26

Figure 4.5 Chiki production flow

27

Figure 4.6 Cheetos production flow

28

viii

LIST OF TABLES

Table 4.1 PT.Indofood Fritolay Makmur Month to Month Sales year 2009 18

Table 4.2 Variable Cost year 2009

20

Table 4.3 Raw material chips product year 2009

21

Table 4.4 Raw material non chips department year 2009

21

Table 4.5 Total fixed cost in year 2009

22

Table 4.6 Volume-revenue table in year 2009

23

Table 4.7 Pricing list 2009

30

Table 4.8 Price changing percentage year 2009

31

Table 4.8 Year 2009 contribution margin table

33