The case begins with a letter from the mill's factory manager to Professor Shah of IIMA, inviting him to work on a costing system for the mill. Professors Shah and Mote meet the executives of the mill to discuss the details about the project. The discussions reveal that the Chief Executive is worried about high cost unprofitable products, etc. The costing system is to be designed to control costs. The professors feel that significant cost reduction in the short run is not possible. One has to put in a lot of effort for increasing contribution. The case ends with the professors agreeing to send forms for collecting data for analysis.