Reference no: EM132165050
ASSESSMENT TASK
Financial business performance analysis and calculations
Assessment - Analysis and calculations
1. Provide answers with respect to the following financial transactions:
a. an owner invests $550,000 in the business and takes out a long term loan of $200,000. What is the value of the assets of the business?
b. the assets of a business are $250,000 and the owner has invested $150,000. What are the liabilities of the business?
c. a business owner has invested $350,000. The current assets are valued at $120,000, current liabilities are $25,000, long term liabilities are $100,000. What is the value of the fixed assets of the business?
2. Fill in the missing figures in the production report below:
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Budget
$
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Actual
$
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Variance
$
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Direct material
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25,550
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?
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1,450U
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Direct labour
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32,000
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35,560
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?
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Factory overhead
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?
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12,250
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500F
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3. Interest rate is 12%. Calculate the simple interest to be paid on $8,000 if the amount is borrowed for:
a. two (2) years;
b. three (3)months;
c. 180 days
4. $2,500 is invested at 8% per annum for three (3) years. You are required to calculate:
a. the amount of the investment compounded after three (3) years;
b. the total amount of compound interest earned in that period.
5. Research and find 2 medium term (5 years) business loan products between ANZ bank and Commonwealth bank. You are required to describe and demonstrate 2products suchas business loan requirements and documents, interest rate and method, interest calculation for 5 years (50 words each, 5 years interest calculations).
6. Gordonvale Products produces bird cages. The annual cost for the product is as follows:
No of units produced 16,000
Storage cost per annum $4
Cost per order $20
You are required to calculate the economic order quantity ("EOQ").
7. A business is offered a discount of 4% to settle an account in 10 days. The net amount must be settled within 30 days to avoid interest on the overdue account. Alternative funding is available at 8% per annum. Perform calculations to determine whether or not the business should take advantage of the 4% discount offered.
8. You are required to perform calculations for the following transactions to determine the cost of funding. The tax rate is 30%.
a. the cost of ordinary shares at 30 June X2. The dividend price per share at 30 June X1 is 60¢. The growth rate per annum is 3%. Market price per share at 30 June X2 is $1.
b. the opportunity cost of distributing $10,000 to shareholders instead of the amount being retained as profit. The amount distributed can be invested at 9% per annum.
c. the cost of 9% $100 debentures after tax with a current market price of $150.
9. a) If a project requires initial expenditure of $150,000, after a three (3) year life it has scrap value of $30,000 and the annual average profit before tax is $28000, what is the accounting rate of return?
b) What are the disadvantages of using the ARR method to evaluate a project?
10. A business has capital of $350,000, total assets of $220,000, a gross profit of $65,000, a net profit of $42,000 and total sales of $250,000. You are required to calculate and explain your evaluation ( formula is required, 30 words each):
a. return on capital;
b. return on total assets;
c. gross margin;
d. net margin.
11. A business has current assets of $220,000, prepayments of $500, current liabilities of $155,000, an overdraft facility of $25,000 and inventory worth $50,000. You are required to calculate and explain your evaluation ( formula is required, 30 words each):
a. the current ratio;
b. liquid ratio.
c. Is the business able to meet all of its debt obligations? Give reasons for your decision.
12. The COGS sold for a business is $120,000. Opening inventory is $26,000 and closing inventory is $34,000. Calculate the inventory turnover ratio for the period and explain why a high ratio is beneficial to the business.
13. The equity of a business is $350,000 and long term liabilities are $110,000. Calculate the gearing or leverage ratio and explain the benefits of a business being highly geared.
14. A company has net profit after tax of $65,000, preference dividends of $5,000 and 20,000 ordinary shares. The net profit after tax distributed to shareholders is $55,000. You are required to calculate:
a. the earnings per ordinary share;
b. dividend per ordinary share
15. Waterloo Furniture Products is preparing its budget for the quarter ended 30 December XXXX.
Sales for the quarter are estimated as follows:
October $ 300,000
November $ 320,000
December $ 350,000
Other transactions include:
Cost of Goods sold ("COGS") is estimated 30% of sales figures.
Salaries are estimated at $150,000 each month.
Administration expenses (fixed costs) are estimated 10% of sales each month
The variable cost per unit is $ 8 per unit
The selling price per unit is $30 per unit.
You are required to:
a) calculate the budget profit or loss for the quarter;
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October
$
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November
$
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December
$
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Total
$
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Sales
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Less COGS
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Gross Profit
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Less Salaries
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Less expenses
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Net profit
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a) Break-even point of each month
b) The contribution per unit of sale of each month
c) Break-even point in units of each month
d) Break-even point sale (dollar) of each month
e) Margin of safety of each month
f) Margin of safety % of each month
16. Researchand find 2 most expensive international and also Australian shares in the market? Also describe about products and services of these companies?
Attachment:- Assessment.rar