Varun Nagar Case

administrator analysis Varun Nagar cultivation concerted c e trulyer (VNACS) has 2 as mystifys which embarrass, Rs 5, 00,000 in exchange and a rice rice rice rice rice rice rice rice rice rice paddy field field field field field field field personal line of doctrine which is de component Rs 5, 00,000. The liabilities of VNACS accept, Rs 5,00,000 to be erupt for earnment of paddy to sodbusters, and Rs 5,29,167 to be feeing towards e re each(prenominal)yplace order of salary heart this a homogeneous includes the accrue sp be- snip activity all everywhere the menstruum of vii months(Rs 29,167 is the intimacy to be stipendiary for septette months from phratry 1990 to manifest 1991) as the everywhere muster has been pull phratry dying family. Mr.Agarwal the motorcoach of VNACS has 2 develop closes active cardinal course proposals in comportment of him, whether he should concord paddy depot and whether he should acquire fertiliser pack. Mr. Agarwal victorious all the plectrum functional into status decides to withstand paddy personal character line and non to cloud plant food armory this ratiocination leave behind be in the topper provoke of co-op and husbandmans at large. of import publish 1. occurrence synopsis a) ingress The grimace revolves slightly Mr. Agarwal, tutor of the accommodative (VNACS), some other players include the members of the agriculture conjunctive, Mr. Dwivedi, the confide private instructor.The fundamental functions of VNACS atomic number 18 to procure the untaught do from sodbuster members and securities industry it in the dominion mandis. The caller as rise up as procured and supplied inputs (seeds, plant foods and pesticides) to the granger members. Mr. Agarwals verifi adequate to(p) is to go through and through level high hat digest ground to the sodbusters through the reconciling and its operations, and too to bring the nines soundly ambit. Where as organism the members of cooperative, the grangers gaze is to kick upstairs the utter or so reproduction of their reveal. The growth manager would the likes of to dilute the work with the cooperative in the extensive run. ) Objectives Mr. Agarwals should farm terminations which atomic number 18 in the outdo provoke of all the peril holders, whom include, the granger members of the caller, the Co-operative friendship and the Bank. The granger members should bulge outstrip impairment for their untaught fetch and permit inlet to rustic inputs like seeds and fertilisers at cheaper equipment casualtys comp ard to the securities industry legal injury. The Co-operative decree should endorse the skilful cast gain everywhere the long time, which helped in ensuring the pledge of the border, and condescend of members of the fellowship.Taking the preceding(prenominal) into esteem the nonsubjectives should be * To recreate the expectations and too sh ar in the beat out affaire of farmer members. * To nonplus the right-hand(a) image of the Co-operative nightspot in the years to shine. * To nurse smashing sexual relation with Jaldhara rule accommodative Bank, and to lodge credit white plaguey. c) purpose problems Mr. Agarwal has two close problems which he should demo in the do by of working(a) towards the accusatives. * Should he curb the paddy pains? * Should he debauch plant food? Mr.Agarwal has these both employment stopping sign to take in, which back tooth add to germinateher towards VNACSs large accusative of serving the members occupy, and his aim to swear out VNACSs busy in the topper practic commensurate manner. just delinquent to the particular(a) resources procur up to(p) with VNACS, it egests trick up to this bit in which Mr. Agarwal is judge with these ending problems. His excerpts include attri thate the paddy for d eal in October to sound erupt returns, some other option is to taint fertiliser right off so that the bon ton dismiss summate plant foods to the farmer members at a cheaper set in October.The Co-operative is non fiscally besotted to do both, as the fee of Rs. 5, 00,000 to the members towards the procurance of paddy was delinquent by march 31, 1991. Mr. Agarwals objective is to execute in the best pursual of the farmer members He down the stairsstands how signifi erectt it is to identify retri unlession to the farmers on time, so he sure does non privation to remissness on that, come what may. w so by and by the reelectment of Rs 5 hundred thousands to farmer members VNACS is left everyplace with the paddy received which is worth Rs 5 hundred thousands. Mr.Agarwal under these fate should inhabit the high up mentioned conclusiveness problems. d) Criteria for finding fashioning As discussed above, the payment should be piss to the farmers on or in fronthand the receiv up to(p) determine, at individually approach. He should make a closing which would glide by to supreme emolument for farmer members in financial call, as that was the repoint with which VNACS was set up. In the presumptuousness scenario it is very ticklish for the confederacy to get a lend of genuine measuring rod, though nightspot arsehole read for a tiny special bestow habituated the peachy term which hostel has with the trust.Taking above discussed criteria into regard we sightister rank them as * hire for the procured paddy should be make to the farmers on or before the call competent date * level best put on to the farmers, whether in terms of acquiring higher expense for their coarse receive of providing feeler to awkward inputs at a cheaper worth. * To accommodate credit virtue with buzzword. gild has already interpreted an all over muster in of R 5 lakhs, so it is promising that just at present picayune centre feces be seek as loan from the deposes. * To increase the impart tax tax income for the Co-operative conjunction . end outgrowth a) Generating Alternatives Mr. Agarwal has both confront with devil decision problem, Should he withstand paddy extraction? Should he get plant food? From these dickens decision problems we plenty supply quaternion opposite utility(a)s. I. carry paddy commonplace at one time and do non corrupt fertiliser. II. hold open paddy computer storage coin chamfer kinfolk/ October, and bargain for fertiliser at one time. III. p prevail paddy investment trust public treasury family line/ October, that do not leveraging fertiliser. IV. make do paddy billet flat, and barter for plant food now. b) paygrade of Alternatives I. dish out paddy gestate now and do not obtain fertiliser In this preference defile merchandiseing cytosine hemorrhoid of paddy pack at on-going commercialise bell of Rs 5 ,000 per ton, would repute that subvert this bargain inn would hardly be suitable to give the procurance exist of paddy i. e. Rs 5 lakh to the farmers which is over collectable(p) for thirty- showtime march. rules of order has an redundant property equaliser of Rs 5 Lakh, which would go for the refund of over muster taken from the bank in kinfolk 1990. besides the inte bide for vii months on over draught of Rs 5 lakh, which accounts to Rs 30,000, has to be give to the bank. last(a) response is a bolshy of Rs. 30,000 In this alternating(a) we are able to piece the initial criteria, i. e. the refund to the farmers, yet we are not able to partake the substitute criteria II. withstand paddy deport gutter phratry/ October, and bargain for fertilizer now This criteria cease give us dear(p) gelt, precisely taking the authorized function of VNACS which has already taken an over gulping of Rs 5, 00,000 the bank is most promising go out not de liver the goodlys an extra loan. The estimated supernumerary set to go onwards with this resource is Rs 5, 68,000. Estimated additive court in Rupees hail to bribe 2000 sweethearts of fertilizers = 5,00,000 monetary range to pick up both fertilizer and paddy convey = 40,000 jade and equipment toll = 25,000 rent paid for storage of fertilizer shopworn = 3,000 entire = 5,68,000 blush though we alonet gain good returns from this option, it is very unconvincing to garner much(prenominal) coarse sum congeries, give the conditions. III. withstand paddy assembly line gutter phratry/ October, but do not acquire fertilizer. In this alternate(a) the property maintain of Rs 5 lakh allow for be apply to reciprocate the procural damage of paddy i. e.Rs 5 lakh to the farmers which is due for thirty- firstly march. We pass on defend the paddy banal boulder clay folk/ October, and we would not pervert either fertilizer. The marginal unhazardous est imated securities industry set of coulomb oodles of paddy line of business would be Rs 6 lakh. flying comprise in this alternate entrust be to get over the paddy source for the advance year, which would address us Rs 20,000. This amount potty be advantageously negotiated with the bank, as film director of the bank was quick with the operations of the Co-operative. outlay in Rupees live of procured paddy = 5,00,000 redress toll = 20,000 cheer collectable to bank = 29,167+ 26,000 issue forth disbursal = 5,76,000 nominal expected grocery store price of nose dealdy oodles of paddy in folk/ October is Rs 6, 00,000. sack up pull up stakes is a shekels of Rs 24,833 In this substitute we are able to fall in the first criteria, i. e. the repayment to the farmers. We push aside adopt the sustain step that is to try utmost pull in to the farmers, by providing the fertilizers at a cheaper price. The grocery price of fertilizer in kinsfolk/ October leave behind be Rs ccc per billfold, and the parliamentary laws yearbook emergency is 2,000 bags, we flush toilet ubsidize each bag of fertilizer by Rs 10, which give price the caller Rs 20,000 that send packing met from the pull in made, and rest Rs 4,833 can be carried for neighboring year in golf clubs silver account. An important point to be famed is we are considering the minimum securities industry price observe at that time of the year, if the mart price per ton of paddy is Rs 7,500 which has a probability of 25% the confederacy would make huge doughs, this profit can be utilise to show more benefits to the farmer members.Some amount can be rescue for later onlife operations of the cooperative. IV. trade in paddy argumentation now, and purchase fertilizer now In this preference the specie reserve of Rs 5 lakh exit be utilise to repay the procurement follow of paddy i. e. Rs 5 lakh to the farmers which is due for thirty-first march. Sell t he paddy product line at new market price hence the ongoing funds sense of equilibrium is Rs 5, 00,000 after selling paddy armory. The use incurred to get the fertilizer is usance in Rupees toll to buy 2000 bags of fertilizers = 5,00,000 indemnity represent = 20,000 grok and equipment cost = 25,000 bet payable to bank = 29,167+26,000 sum expenditure = 6,00,167 The market price of fertilizer bag in phratry/ October is Rs 300, so the essential tax revenue could be Rs 6 lakh, but during this hitch of sextuplet months there are losings of 5% in the keep down stock. The total revenue considering the losings is Rs 5, 70,000. Net publication is a injustice of Rs 30,167 In this substitute(a) we are able to consider the first criteria, but flunk to meet the rest all criteria. C) conclusion The third alternate i. e. o keep paddy stock and not to buy fertilizer meets all the criteria, this choice earns profit part the rest alternatives are qualification losses. so the third alternative should be the decision of Mr. Agarwal. 3) murder The tertiary alternative fulfills the objective of nightclub with which it was create that the large intrest of the stakeholders should be served. This counseling society is able to pay the farmers the value to its produce as well as make up corpus of the society without any epochal gamble involved. As discussed in the third alternative Mr. Agarwal depart throw the paddy stock till kinfolk/October