Learning outcomes.Upon successful completion of this module, students will have demonstrated: KnowledgeLo1. Improved knowledge in the collection and analysis of a variety of data.Lo2. Ability to understand and interpret business problems including basic demand and supply analysis. Skills:S1. Critical thinking and analysis skillsS2. Skills in data analysis and produce information in appropriate formats for decision making in an organisation contextS3. Develop skills in using software generated information to make decisions at operational, tactical and strategic levels in an organisation.Requirements:You must answer any Three questions. Each question that is attempted will carry a maximum mark of 33 and 1mark for presentation. Word limit is 3,500.Question 1Jonathan, operations manager of Milton Keynes farms limited (MKF Ltd.) lacks strong insight in any realistic business decision making. However, he has been able to use the cost diagram below to illustrate and influence costing decisions in the company, MKFLtd:According to Jonathan, his budgeted annual output is 180,000 units, fixed cost amount to £60,000, variable costs is £0.75 per unit and the sales price is £2.00 per unit.Required:a) Develop a mathematical model using the cost information above. (7 Marks)b). Calculate the profit or loss of MKF Ltd. using the above information. (6 marks)Draw a graph with a spreadsheet, for a five-year projection from January 2022 taking into consideration an annual expected increaseof 8% in variable cost and 5% increase in both output and sales price (NB. The changes must take effect from 2022). (8 marks) d) Critically analyse and comment on the costing and revenue behaviour before and after your projections. (12 marks.)Question 2The figures below represent expenditure on advertising and sales revenue of a manufacturer of fitness equipment, Run-Well limited between the period of 2016 to 2020. Year Advertising expenditure (X)(£000s)2016 22017 52018 42019 62020 3Sales revenue (Y)(£000S) 609070100 80 Assuming you are a newly employed graduate business analyst, you are required to:a) Calculate the correlation coefficient of advertising/sales and comment on your results.
(10 marks)b) Plot a scatter diagram of the data and discuss the pattern of the relationship of the variables. (8 marks)c) Criticallyanalysetheimpactofadvertisingexpenditureonsalesandadvisethemarketing manager on how the company can gain a competitive advantage in the fitness industry byadopting other relevant marketing strategies. (15 marks) Question 3Raincoat Plc. produces and install ceiling materials. Below is the company’s estimated profit statement for the next accounting year, prepared using marginal costing principles. Per unitSelling priceVariable costs:Labour Materials ContributionLess Fixed Costs:Administration OtherProfit£ £ 140,000 102,000440,000198,000 40,00050,000 90,000108,000 Two suggestions have been made in an attempt to improve profit for next year: One by the operations manager and the other by the marketing Manager.1.Operations manager’s suggestionThe operations manager has suggested that cheaper materials could be used, which will reduce total material cost to £80,000. However, this will require additional fixed costs of £24,000 to cover the inspection of the cheaper materials.2. Marketing manager’s suggestionThe marketing manager has suggested an intensive advertising campaign. He estimates that this will increase sales volume by 20% over the estimated amount above. Variable cost as a percentage of sales revenue would not be affected by this option but extra fixed cost of £45,000 will be incurred to cover the advertising campaign.As a graduate business analyst in Raincoat, you are tasked to: a) Determine:i. The company’s breakeven point (3 marks)ii. The margin of safety as a percentage of estimated sales. (3 marks)for each of the original estimates, operations, and marketing manager’s suggestion.b) On purely financial grounds explain whether Raincoat Plc. should adopt the original plan or amend it in line with either theoperations manager’s or marketing manager’s suggestion. (6 marks)c) Whatfactors(notincludedinyouranalysisaboveshouldRaincoatPlc’smanagementconsiderbeforecommittingacompany to the course of action. (6marks)
(d) Critically analyse the benefits and limitations of the breakeven model, its application in marginal costing and as a business strategy for Raincoat Plc. (15 marks)Question 4As part of an interview for a position as a Graduate Business Analysts for the Internal revenue service in UK, you are required to demonstrate your research and business analytical skills. As a result, you are tasked to:a (i) Research the monthly digest of statistics or the national statistical archives for any two economic variables which you think may be correlated (e.g., retail price index/employment, inflation/money supply, GDP/employment etc.) and(ii) Critically analyse and present your results in writing to the interview panel.Bear in mind the dangers of spurious correlation and seeking other factors, which may be influencing your data, including outliers. Interpretation may be simpler if you select cross sectional data taken at the same point in time (e.g., regional figures) rather than longitudinal data taken over a ten-year period. (33 marks) Categories GradeRelevance Knowledge Analysis Argument andStructure Critical Evaluation Presentation Reference to Literature 86 – 100% The work examined is exemplary and provides clear evidence of a complete grasp of the knowledge, understanding and skills appropriate to the Level of the qualification. There is also ample excellent evidence showing that all the learning outcomes and responsibilities appropriate to that Level are fully satisfied. At this level it is expected that the work will be exemplary in all the categories cited above. It will demonstrate a particularly compelling evaluation, originality, and elegance of argument, interpretation or discourse. 76- 85%The work examined is outstanding and demonstrates comprehensive knowledge, understanding and skills appropriate to the Level of the qualification. There is also excellent evidence showing that all the learning outcomes and responsibilities appropriate to that level are fully satisfied. At this level it is expected that the work will be outstanding in the majority of the categories cited above or by demonstrating particularly compelling evaluation and elegance of argument, interpretation or discourse. 70 – 75% The work examined is excellent and is evidence of comprehensive knowledge, understanding and skills appropriate to the Level of the qualification. There is also excellent evidence showing that all the learning outcomes and responsibilities appropriate to that level are satisfied At this level it is expected that the work will be excellent in the majority of the categories cited above or by demonstrating particularly compelling evaluation and elegance of argument, interpretation or discourse. 60 – 69% Directly relevant to the requirements of the assessment A substantial knowledge of strategy material, showing a clear grasp of themes, questions and issues therein A goodstrategic analysis, clear and orderly Generally coherent and logically structured, using an appropriate mode of argument and/or theoretical mode(s) May contain some distinctive or independent thinking; may begin to formulate an independentposition in relation to strategic theory and/or practice. Well written, with standard spelling and grammar, in a readable style with acceptable format Critical appraisal of up-todate and/or appropriate literature.Recognition of different perspectives. Very good use of source material. Uses a range of sources 50 – 59% Some attempt to address the requirements of the assessment: may drift away from this in less focused passages Adequate knowledge of a fair range of relevant strategy material, with intermittent evidence of an Someanalytical treatment, but may be prone to description, or to narrative, which lacks clear Some attempt to construct a coherentargument, but may suffer loss of focus andconsistency, with issues at stake stated only vaguely, or Sound work which expresses a coherent position only in broad terms and in uncritical conformity to one or more standard views of strategy. Competentlywritten, with only minor lapses from standard grammar, with acceptable format Uses a variety of literature which includes some recent strategic texts and/or appropriate literature, though not necessarily including a appreciation of its significance analytical purpose theoretical mode(s) couched in simplistic terms substantive amount beyond library texts. Competent use of source material. 40 – 49%Some correlation with the requirements of the assessment but there are instances of irrelevance Basic understanding of the strategy but addressing a limited range of material Largely descriptive or narrative, with little evidence of analysis A basic argument is evident, but mainly supportedby assertion and there may be a lack of clarity and coherenceSome evidence of a view starting to be formed but mainly derivative. A simple basic style but with significant deficiencies in expression or format that may pose obstacles for the reader Some up-to-date and/or appropriate literature used. Goes beyond the material tutor has provided. Limited use of sources to support a point. 35 – 39% Relevance to the requirements of the assessment may be very intermittent, and may be reduced to its vaguest and least challenging terms A limited understanding of a narrow range of strategic material. Heavy dependence on description, and/or on paraphrase, is common Little evidence of coherent argument: lacks development and may be repetitive or thin Almost wholly derivative: the writer’s contribution rarely goes beyond simplifying paraphrase Numerous deficiencies in expression and presentation; the writer may achieveclarity (if at all) only by using a simplistic or repetitious style Barely adequate use of literature. Over reliance on material provided by the tutor. The evidence provided shows that the majority of the learning outcomes and responsibilities appropriate to that Level are satisfied – for compensation consideration. 30 – 34% The work examined provides insufficient evidence of the knowledge, understanding and skills appropriate to the Level of the qualification. The evidence provided shows that some of the learning outcomes and responsibilities appropriate to that Level are satisfied. The work will be weak in some of the indicators. 15- 29%The work examined is unacceptable and provides little evidence of the knowledge, understanding and skills appropriate to the Level of the qualification. The evidence shows that few of the learning outcomes and responsibilities appropriate to that Level are satisfied. The work will be weak in several of the indicators.0-14% The work examined is unacceptable and provides almost no evidence of the knowledge, understanding and skills appropriate to the Level of the qualification. The evidence fails to show that any of the learning outcomes and responsibilities appropriate to that Level are satisfied. The work will be weak in the majority or all of the indicators. Generic Assessment Criteria – UndergraduateThese should be interpreted according to the level at which you are working and related to the assessment criteria for the moduleNotes:11