the assignment is attached below
1 Individual Assignment Unit: TACC101 Accounting 1A Due Date: 5pm Friday, 28 September 2018 Total Marks: 100 marks (20%) Number of Questions: 3 Parts Instructions: All questions should be attempted. The marks of each question would be awarded based on your understanding of the questions, concepts and procedures; hence you should demonstrate your answers step by step. 2 PLEASE READ THIS DOCUMENT CAREFULLY BEFORE YOU BEGIN, SO YOU DO NOT LOSE MARKS. INSTRUCTIONS TO FOLLOW: • Any list of the references actually cited must be included in your assignment paper. • Font type should be Times New Roman (size 12), paragraph spacing should be equal to 1.5. Marks: The assignment is worth 20% of the total mark for the unit. The marks awarded will depend on the quality of the reasoning exhibited and the ability to express the argument in a concise manner. Due date: The assignment must be submitted on or before 5pm Friday, 28 September 2018. Late assignments will be accepted up to 72 hours after the submission deadline. There will be a deduction of 20% of the total available marks made from the total awarded mark for each 24 hour period or part thereof that the submission is late (for example, 25 hours late means a 40% penalty). HOW TO SUBMIT YOUR ASSIGNMENT No hard copy is required You MUST submit an electronic copy through TURNITIN on Moodle for checking plagiarism. Failure to submit it may result in a zero mark for the entire assessment. 3 Part A (20 marks) Refer to the 2017 annual report of JB Hi-Fi Limited on its website, www.jbhifi.com.au and answer the following questions: 1. What is the total value in the consolidated financial statements for each of the following items at the end of the year? • Cash and cash equivalents • Inventories • Sales revenue • Other income • Plant and Equipment • Interest Expense (finance costs) • Sales and marketing expense • Occupancy expenses • Trade and other payables • Borrowings (non-current) 2. What is the normal balance for each of the accounts listed above? What side of the account, debit or credit, is affected in order to decrease each item? Part B (40 marks) Refer to the 2017 annual report of JB Hi-Fi Limited on its website, www.jbhifi.com.au and answer the following questions: 1. What are the different types of revenues generated by the consolidated group? 2. How are the group’s assets classified? 3. What are the major categories listed among the group’s equity? How many ordinary shares did JB Hi-Fi Limited have at the end of the financial year? 4. What is the group’s current liability for dividends to ordinary shareholders? If you owned only 100 ordinary shares in JB Hi-Fi Limited, how much would you receive in dividends? If added the interim dividend, what is the current year’s total amount of dividend per share? What is the Last year’s final dividend paid in the current period? 5. How do the dividends per share compare with the group’s ‘earnings’ per share (use basic earnings per share)? What is the dividend payout ratio for current year? http://www.jbhifi.com.au/ http://www.jbhifi.com.au/ 4 Part C (40 marks) Refer to the 2017 annual report of JB Hi-Fi Limited on its website, www.jbhifi.com.au and answer the following questions: 1. List the subsidiary companies in the JB Hi-Fi Group. 2. What is the value of the group’s sales revenue for the current and previous years? What has been the percentage change in sales revenue for the current year? 3. What is the group’s final profit (after income tax) for the current and previous years? What has been the percentage change in profit (after income tax) for the current year? 4. Compare the percentage change in (2) with the percentage change in (3). What information does this comparison provide? 5. What is the total value of inventories on hand for both current and previous years? What is the percentage change in inventory levels? How does this compare with the percentage change in sales revenue calculated in question (2)? Comment on any differences. 6. Calculate profit margin and inventory turnover, two profitability ratios for 2013. END OF THE ASSIGNMENT. http://www.jbhifi.com.au/ ANNUAL REPORT 2017 916CRN4225_JB_Hi-Fi_Annual_Report_2017 - 1 - Cover_v1.indd 2 18/08/2017 7:03:12 PM F or p er so na l u se o nl y Financial Summary JB Hi-Fi Limited ABN 80 093 220 136 Sales $5.63b NPAT(ii) $207.7m Stores EBIT $306.3m FINANCIAL PERFORMANCE 2013 Statutory 2014 Statutory 2015 Statutory 2016 Statutory 2017 Statutory 2017 Underlying(i) Growth Underlying(i) Sales $3.31b $3.48b $3.65b $3.95b $5.63b $5.63b 42.3% EBIT $177.8m $191.1m $200.9m $221.2m $268.2m $306.3m 38.5% NPAT(ii) $116.4m $128.4m $136.5m $152.2m $172.4m $207.7m 36.5% Earnings per share 117.7cps 128.4cps 137.9cps 153.8cps 154.3cps 186.0cps 22.4% Total dividend - fully franked 72.0cps 84.0cps 90.0cps 100.0cps 118cps 118cps 18.0% (i) Underlying results exclude transaction fees and implementation costs totalling $22.4m associated with the acquisition of The Good Guys in November 2016 and $15.8m of fi xed asset and goodwill impairments in New Zealand. (ii) Profi t attributable to the owners of JB Hi-Fi Limited, excludes non-controlling interests. 2013 2014 2015 2016 2017 2013 2014 2015 2016 2017 $3.31b $177.8m $3.48b $191.1m $200.9m $5.63b 2013 2014 2015 2016 2017 2013 2014 2015 2016 2017 177 182 187 303 $116.4m $128.4m $136.5m $3.65b $3.95b $152.2m 194 $221.2m $306.3m(i) $207.7m(i) JB Hi-Fi acquired The Good Guys on 28 November 2016, all amounts disclosed for the 2017 fi nancial year include The Good Guys for the period under JB Hi-Fi ownership. 916CRN4225_JB_Hi-Fi_Annual_Report_2017 - 2 - Inside Cover_v5.indd 2 8/09/2017 1:07:52 AM F or p er so na l u se o nl y 1 Dear fellow shareholder, 2017 has been a great year for JB Hi-Fi Limited. It is very pleasing to report that the year ended 30 June 2017 was another record year with sales, profits and dividends all up on the prior year and in November 2016 we successfully completed the purchase of The Good Guys. The 2017 result was driven by a combination of sales growth, a continued focus on growth in gross profit dollars and our low cost of doing business, underpinned by our ongoing emphasis on customer service. Overview JB Hi-Fi Limited and its subsidiaries (the “Group”) achieved sales of $5.6 billion, up 42.3% on the prior year. Group underlying EBIT was up 38.5% on the prior year to $306.3 million. Group underlying NPAT was up 36.5% to $207.7 million and Statutory NPAT was up 13.3% to $172.4 million. Earnings per share was up 22.4% to 186.0 cents per share and the total dividend for FY17 was up 18 cents per share on the prior year to 118 cents per share. JB Hi-Fi Australia JB Hi-Fi Australia total sales grew 10.9% to $4.15 billion, with comparable sales up 8.6%. Online sales grew 38.4% to $158.9 million or 3.8% of total sales, reflecting continuous improvement across many aspects of the business’s digital assets. JB Hi-Fi Solutions continued to grow and remains on track to deliver on its longer term aspirational sales target of approximately $500 million per annum. Gross profit increased by 11.7% to $922.8 million resulting in a gross margin of 22.2%. CODB was 15.0%, down 21 bps on the prior year. Total operating costs were in line with our expectations and remained well controlled as the business continued to deliver the high standard of customer service that JB Hi-Fi is known for. The business’s low CODB remains a competitive advantage and is maintained through continued focus on productivity and minimising unnecessary expenditure. Strong sales growth, combined with operating cost leverage, drove strong earnings growth. EBIT was up 19.1% on the prior year to $262.4 million while EBIT margin was up 43 bps at 6.3%. JB Hi-Fi New Zealand Total sales were down 0.3% to NZD234.0 million, with comparable sales down 8.8%. Sales in the prior year were aided by market wide demand for third party content cards. Excluding the impact of these cards (NZD8.4m), total sales in New Zealand were up 3.4%, with comparable sales down 5.3%. Online sales in New Zealand for FY17 grew 5.3% to NZD4.9 million or 2.1% of total sales. We have recently launched a new website and are pleased with its performance to date. In light of the challenging recent financial performance in New Zealand, fixed asset and goodwill impairments totalling AUD15.8 million were recorded in the statutory FY17 results. This was a non-cash adjustment. We have completed a review of the New Zealand business and are finalising a two year strategy to improve performance. The Good Guys The Good Guys was acquired on 28 November 2016. For the period under JB Hi-Fi ownership, total sales were up 0.2% to $1.26 billion with comparable sales down 1.3%. Online sales were $64.4 million or 5.1% of total sales. Total operating costs were in line with expectations and store wages remained well controlled. Similar to the JB Hi-Fi business, the low CODB remains a competitive advantage and will continue to be a focus moving forward. Earnings for the period under JB Hi-Fi ownership of $46.4 million were pleasing and in line with the prior year. Terry Smart was appointed Managing Director of The Good Guys in April 2017. Since Terry’s appointment we have made a number of positive changes in both the stores and at support office to position the business for future growth. Stores We had 303 stores in Australia and New Zealand at 30 June 2017. In Australia, six new JB Hi-Fi stores were opened and in New Zealand one new JB Hi-Fi store was opened. On acquisition of The Good Guys, we acquired 103 stores. Since acquisition, one new The Good Guys store has been opened and two closed. There were 102 The Good Guys