Prepare comparative income statements and balance sheet

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Reference no: EM131475668

Financial Analysis for Managers Individual Assignment-

Intended learning outcomes:

1. Evaluate the performance of a company using various financial analytical tools.

2. Analyse different patterns of cost behaviour and apply cost-volume-profit analysis to business decisions.

3. Select and apply investment appraisal techniques appropriately.

4. Evaluate the performance of business units using both financial and non-financial measures.

Answer all questions -

Q1. Assume that you are a Financial Analyst working for Middle East Venture Capital L.L.C. Evaluate the financial performance of a company listed in the Muscat Securities Market (MSM)/GCC Market by taking into consideration the following instructions.

Instructions:

  • Select a company listed in Muscat Securities Market/GCC Market (preferably other than banking and investment companies or Holding companies).
  • Collect financial reports of the chosen company for three consecutive years.
  • Use annual financial statements for analysis. Avoid using quarterly statements.
  • Provide references for the data collected (use Coventry Harvard style of referencing). Company websites can also be used for data collection.
  • From the financial statements and additional information collected by you complete the below mentioned tasks.

TASKS -

a. Prepare comparative income statements and balance sheet for 3 years using Horizontal and Vertical Analysis techniques for the both income statements and balance sheet.

b. On the basis of literature review and from the above computations analyse; Profitability position and Financial position of the chosen company.

c. Compare and contrast Vertical analysis and Horizontal analysis techniques.

Q2. Mars Hypermarket LLC is planning to expand and open new stores in Sultanate of Oman. Currently they are considering two options, one is to start a new store in Barka and other is to take over an existing store in Ibra. But due to recent developments they will be able to fund only one store as the overall revenue trends are subdued. The required rate of return is 10%. Details of cash inflows of 5 years of the two projects along with additional information is given in the table below,

Details

New Store at Barka

Take-over existing at lbra

Suppliers availability

Not available. To be initiated

Already existing

Consumer trends

Growth expected at 10%

Stagnated

Population growth

12%

5%

Competition

Strong

Moderate

Initial cost

200,000

200,000

Cash flows

Year 1

60,000

20,000

Year 2

80,000

60,000

Year 3

100,000

80,000

Year 4

60,000

120,000

Year 5

40,000

80,000

a. Evaluate the projects using, Net Present value Method and Internal Rate of Return method.

b. Based on the above analysis and on the basis of the relevant literature review, which project would you recommend and why. The students have to consider the non-financial information provided in the case and other relevant non-financial factors while recommending a project.

Q3. Your company, a leading cement manufacturer has asked you to submit a cost-volume-profit analysis report for the two products being produced in your company.

Product A

Product B

 

RO

RO

 

RO

RO

Sales

 

300,000

Sales

 

300000

Less: Variable Cost

240000

 

Less: Variable Cost

200000

 

Fixed Cost

30000

270000

Fixed Cost

70000

270000

Budgeted Profit

 

30000

Budgeted Profit

 

30000

You are required to:

a. Calculate break - even point of each product.

b. The company prefers to maintain a desired profit of RO 10,000. Identify the sales volume to maintain the desired profit.

c. Compute margin of safety for both products.

d. The business is expected to go through ups and downs in the demand hence you need to state which product is likely to earn greater profit in conditions of heavy demand for the product and low demand for the product.

e. Evaluate the importance of the role of CVP analysis in taking business decisions with appropriate literature review.

Reference no: EM131475668

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Reviews

inf1475668

5/17/2017 4:28:02 AM

Thanks you guys, i recvd the work and its good, for now I dont need any kind of modification, i will update you if anything required. good work

inf1475668

5/17/2017 4:26:57 AM

i need more cheaper than this price i made with you other assignments and I'm old customer and will be regular customer for next 4 semester

len1475668

4/27/2017 1:52:15 AM

Subject: Financial Management. I need two Assignments for me and my friend I choose OMAN INT. MARKETING (OIMS) my friend choose OMAN CABLES INDUSTRY (OCAI). The report should have table of contents and appendices if any. Appropriate references using Harvard style of referencing and in-text citations are mandatory. The report to follow font style Times New Roman, font size 12 and text color black. Show a thorough understanding of the purpose of the activity. Display knowledge of the major principles, theories, methodologies, and practices involved and an ability to apply them effectively. Provide evidence of wide reading, including academic journals. Demonstrate an ability to select critical points, evaluate them and communicate the conclusions effectively. Provide approaches that are creative, practicable, and supported. Provide a sound, supported critique of your own work. Provide sound and supported discussions of further research that may be needed.

len1475668

4/27/2017 1:52:08 AM

Outstanding application of numeracy skills and excellent ability to apply the tools. Evidence of rigorous literature review and scholarly works. Outstanding interpretation of critical factors in the analysis and very meaningful conclusions drawn in relation to the company of evaluation. Outstanding discussion and excellent knowledge of relevant theories and concepts related to the techniques used for the evaluation and evidence of rigorous literature review. Outstanding presentation, logically structured, using correct grammar and spelling, accurate referencing and bibliography correctly using the CU Harvard Style.

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