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Durga Vehicle Ltd is an auto replacement components manufacturing company in Jamshedpur. It was founded by two brothers Sumanta Chatterjee and Hemanta Chatterjee in 1982.
These two brothers completed their very own schooling until 11th & 12th School respectively, and after that dropped out of the formal education, because their particular parents desired them to take a step on their own rather than becoming a government employee.
EVOLUTION OF Durga Automobile Ltd
That they started a motor car port in 1977, then started their own spare part manufacturing unit for large vehicles in 1983.
CREATING TRUST: They started the organization with merely fourteen employees. It took all of them seven years to size up, while gaining the trust of the customers was difficult. We were holding able to work with 60 staff, had Telco as their key customer and did an enterprise of Rs 2 crore in 1990. As they gained confidence, they continuously scaled up and in addition they even came into the car-auto segments simply by 2002.
The corporation had shown consistent functionality till a year ago in the American indian market of Rs 6000-7000 crore. Yet, in the last 1 / 4 of, the internet profits and net product sales dipped by 20 percent and 25 percent correspondingly.
The CFO of Durga Vehicle, Sumanta Chatterjee, directed the controller, Debashish Bose to present an account in the budgeted and actual efficiency of the organization for the present month. Debashish with the help of Main Account Curator, Anand Singh presented the relevant cost/profit info summarised in Exhibit you
Based on these, the control mechanism prepared a comparative income statement to provide to CFO. (Exhibit 2)
Question: Make a detailed variance analysis and highlight the remedial steps that Durga Auto is going to take to remedy the situation arising away of suffering profitability and sales recently and resolve responsibility intended for the variance.