ASSIGNMENT INSTRUCTIONS Assessment Coursework Assessment code: 010 Academic Year: 2020/21 Trimester: 2 Module Title: Business Finance Module Code: MOD003319 Level: 4 Module Leader: Nidhi Gogia...

1 answer below »
(Gbike/Helen) urgent due on Thursday morning 220209/11/ please follow case study with all business structure highlighted with title page , content page , and clear structure and check presentation format.



ASSIGNMENT INSTRUCTIONS Assessment Coursework Assessment code: 010 Academic Year: 2020/21 Trimester: 2 Module Title: Business Finance Module Code: MOD003319 Level: 4 Module Leader: Nidhi Gogia Weighting: 50% Word Limit: 2500 This excludes bibliography and other items listed in rule 6.75 of the Academic Regulations: http://web.anglia.ac.uk/anet/academic/public/academic_regs.pdf Assessed Learning Outcomes 1-3 Submission Deadline : This assignment must be received no later than 14:00 on Friday 27th November 2020 http://web.anglia.ac.uk/anet/academic/public/academic_regs.pdf WRITING YOUR ASSIGNMENT:  This assignment must be completed individually.  You must use the Harvard referencing system.  Your work must indicate the number of words you have used. Written assignments must not exceed the specified maximum number of words. When a written assignment is marked, the excessive use of words beyond the word limit is reflected in the academic judgement of the piece of work which results in a lower mark being awarded for the piece of work (regulation 6.74).  Assignment submissions are to be made anonymously. Do not write your name anywhere on your work.  Write your student ID number at the top of every page.  Where the assignment comprises more than one task, all tasks must be submitted in a single document.  You must number all pages. SUBMITTING YOUR ASSIGNMENT: In order to achieve full marks, you must submit your work before the deadline. Work that is submitted late – up to five working days after the published submission deadline - will be accepted and marked. However, the element of the module’s assessment to which the work contributes will be capped with a maximum mark of 40%. Work cannot be submitted if the period of 5 working days after the deadline has passed (unless there is an approved extension). Failure to submit within the relevant period will mean that you have failed the assessment. Requests for short-term extensions will only be considered in the case of illness or other cause considered valid by the iCentre Adviser. Please contact [email protected]. A request must normally be received and agreed by the iCentre Adviser in writing at least 24 hours prior to the deadline. See rules 6.56-6.65: http://web.anglia.ac.uk/anet/academic/public/academic_regs.pdf Mitigation: The deadline for submission of mitigation in relation to this assignment is no later than five working days after the submission date of this work. Please contact [email protected] See rules 6.103 – 6.132: http://web.anglia.ac.uk/anet/academic/public/academic_regs.pdf mailto:[email protected] http://web.anglia.ac.uk/anet/academic/public/academic_regs.pdf mailto:[email protected] http://web.anglia.ac.uk/anet/academic/public/academic_regs.pdf 1.1 Case Study – T shirts Ltd You are a finance trainee for a company of Vests plc and have been asked by your marketing manager to review the business of your key competitor T-shirts plc and to assist her with helping the marketing team understand financial information. You know that T-shirts plc is struggling in the current economic climate and that other expenses have risen as a result of an aggressive advertising campaign to stimulate sales. Your sales manager has informed you that T-shirts plc increased the credit terms given to their customers from 30 days to 60 days in an attempt to attract more business. The rate of interest on the bank overdraft in 2019 is significantly higher than the rate of interest on the loan. 1.2. Task Prepare a 2,500 word business report for your manager providing analysis and business advice following the requirements below. Presentation and format: Business report with a title page, contents page and clear structure. It must be written in an appropriate business tone with appropriate Harvard reference where necessary. Note no introduction is required. No marks will be awarded for an introduction. 5 marks Part 1: Business Performance Analysis: 40 marks total To support your analysis for this part you will need to calculate and use appropriate ratios using the course definitions. You need to show all ratio calculations workings which should be placed in the appendices to your report. 1.1. Statement of Profit or Loss Analyse and comment on the financial performance of T-shirts Ltd using the case study information and exhibit 1. Your analysis should critically evaluate all the lines of the Statement of Profit or Loss. 20 marks 1.2. Statement of Financial Position Analyse and comment on the financial position of T-shirts Ltd using the case study information and exhibit 1. Your analysis should critically evaluate all the lines of the Statement of Financial Position. 20 marks Part 2: Understanding Financial Information & Management of Cash: 25 marks 2.1. Explain the concept of accrual accounting versus cash accounting, including the benefits and any limitations of each, with examples from this case study where relevant. 15 marks 2.2. What is meant by Profit and Cash flow and how they are different. 10 marks Part3: Budget techniques and Company Finance: 30 marks 3.1. Define Budget and explain purposes of preparing a budget. 15 marks 3.2. What might be the main benefits of forming a limited company and listing it on a stock exchange. 15 marks The word limit of 2,500 words excludes numerical tables, bibliography and appendices. To assist you with this task you have been supplied with the following information:  Exhibit 1: Extracts from T-shirt Ltd’s Financial Statements for 2019, including the Statement of Profit or Loss, and the Statement of Financial Position. 1.3. Assessment Submission Structure Part 1: Business Performance Analysis 1.1 Statement of Profit or Loss 1.2 Statement of Financial Position Part 2: Understanding Financial Information & Management of cash 2.1 Accruals vs cash accounting 2.2 Profit vs Cash flows Part 3: Budget and Company Finance 3.1 Meaning and Purposes of Budget 3.2 Benefits of forming a limited company and getting it registered on a stock exchange Appendices  Supporting calculations  Bibliography as required Exhibit 1: Extracts from T-shirt Ltd’s Financial Statements for 2019 Summary Statement of Profit & Loss for the years ended 31 December 2019 2018 £000 £000 Revenue 1,366 2,101 Cost of sales (751) (840) Gross profit 615 1,261 Other expenses (1,009) (820) Profit before interest and tax (394) 441 Finance costs (106) ( 69) Profit / (loss) for the year ( 500 ) 372 Summary Statement of Financial Position as at 31 December 2019 2018 £000 £000 ASSETS Non-current Assets Property, Plant and Equipment 1,274 1,282 Current Assets Inventories 121 89 Trade and other receivables 305 218 Cash and cash equivalents 0 45 426 352 Total Assets 1,700 1,634 EQUITY AND LIABILITIES Equity Share Capital 310 310 Retained Earnings 0 500 Total Equity 310 810 Non-current Liabilities Long-term borrowings 921 688 921 688 Current Liabilities Trade payables 151 136 Bank overdraft 318 0 469 136 Total Liabilities 1,390 824 Total Equity and Liabilities 1,700 1,634 End of case study
Answered Same DayNov 21, 2021

Answer To: ASSIGNMENT INSTRUCTIONS Assessment Coursework Assessment code: 010 Academic Year: 2020/21 Trimester:...

Riddhi answered on Nov 23 2021
154 Votes
Business performance Analysis on T shirts
Table of contents
    
1. Business Performance Analysis on T shirts Ltd
1.1 Statement of Profit and loss
1.2 Summary Statement of Financial Position
    
2. Business Performance Analysis on T shirts Ltd
2.1 Statement of Profit and loss
2.2 Summary Statement of Financial Position
    
3. Understanding Financial Information and Management of Cash
3.1 Concept of Accrual Accounting versus Cash Accounting
3.2 Profit and Cash Flow
    
4. Budget Techniques and Company Finance
4.1 Budget and Purpose of Preparing Budget
4.2 Benefit of Forming a Limited Company
4.3 Benefit of Listing a Company on a Stock Exchange
Business Performance analysis
The performance of the business is analyzed using statement of profit and loss account to understand the profit of the company and its comparison with the previous year to understand the reason for such change in profit or to monitor the reason for losses in the company. The analyzes is also done using financial statement to understand the number of days of inventory-maintained numbers of credit provided to debtors and number of days credit provided to creditors of the company. The return on equity also plays an especially important role as this return suggest the return available to the shareholders of the company who are the ultimate owner of the company. Performance analysis helps in understanding the performance of the business and the reasons behind such performance which can be further discussed with the top authorities of the company and the means for mitigating such risk are found by the company.
Statement of profit or loss account
The profit and loss account of the organization as per trend analysis shows negative growth in the organization. The sales of the organization have reduced from 2101 in 2018 to 1366 in 2019. The sales have reduced by 35% which is a huge reduction in sales year on year. The cost of sales has not reduced considerably as compared to reduction in sales which says that the cost of manufacturing or wastage of the product has increased substantially which had a huge impact on profitability of the business. The cost of sales has reduced by 10.59% as compared to reduction in sales of 35%. This has resulted in reduction of gross profit of the organization by 51%. More than 50% of the gross profit has been lost in the year 2019 which has a direct impact on the company’s going concern ability.    
The analysis of profit and loss account helps us in analyzing the overall business performance at not just domestic level but also global level of the economic activity of the entity and also assist in analyzing analytical aspects along with the scope of exploitation of books of accounts to the evolution in the financial and structural performances (Bogdănoiu, C.L., 2019)
The gross profit ratio of the company was 60% in 2018 but reduced to 45% in 2018. The change in gross profit ratio of the organization is 25% from 2018. The reason for change in gross profit is primarily because of reduction in sales of the organization and increase in cost of sales. Increase in cost of sales could be because of factors like increase in rate of raw materials due to global demand or due to situations that are favorable for the country.    
Despite reduction in sales, the expenses of the organization have increased from 820 in 2018 to 1009 in 2019, which resulted in increase in expenses by 23%. Increase in expenses, increase in cost of sales and reduction in sales has resulted in     loss in the year 2019 from profits in the year 2018. The company made a loss before taxes of 394 from profit of 441 in the year 2018. Company has also procured funds which resulted in increase in finance cost of the company. The finance cost has increased from 69 in 2018 to 106 in 2019. The net profit after taxes of the organization in 2018 was 372, but in year 2019 the net loss after taxes shall be 500. The trend analysis shows the net percentage of change in trend by 234% which is a ridiculously huge change in a financial year. The reduction in sales could be on account of reduced demand for the product or competition or the quality of the product would have deteriorated.    
The operating profit margin of the company     in 2018 was 0.21 which increased to -0.20 in 2019. The trend analysis show reduction in     profit margin by 38%.    Operating profit of the company is reduced as a result reduction in gross profit and increase in other expenses and finance cost. This could be because company has been spending more on the marketing spends to increase the sales which may not be working for the company.                     
Statement of financial position
Analyzes of financial statement of the company is a lengthy and cumbersome process and this process is undertaken to assist management in decision making of the company. The ratio analyzes of the financial statements are most suitable for understanding the financial position of the company. Data analyzes is usually done using Quick ratio, current ratio, Gross profit margin, Net profit margin, Asset turnover ratio and Inventory turnover ratio. (Goud, M.A.A. and Kumar, M.K.S., 2019)
The fixed assets of the company being Property, Plant and equipment has not changed considerably from 1282 in 2018 to 1274 in 2019 and such difference of 0.62% shall be on account of depreciation provided in the books of accounts.
There has been an increase in inventory from 89 in 2018 to 121 in 2019 which says that the cost of holding the inventory would have increased and the inventory turnover in the organization would have also reduced.
There has been an increase in the trade and other receivables...
SOLUTION.PDF

Answer To This Question Is Available To Download

Related Questions & Answers

More Questions »

Submit New Assignment

Copy and Paste Your Assignment Here