Multitasks Assignment II
This multitasks written assessment has THREE tasks relating to management accounting and the use of management information for decision making. The objectives are:
To test your understanding of the management accounting function
To test your knowledge of key management accounting concepts and processes
To test your ability to analyse and interpret financial information and use them to make appropriate business decisions.
This is a pre-seen open book assessment, and you may complete it in your own time, at any point up to the submission deadline indicated below.
Instructions
Please follow all instructions below carefully:
You should type your answers into a word document clearly and legibly
Please save the document in the style “ACFIXXXX – Pnumber” e.g. “ACFI1203 – P1234567”.
There are three (3) tasks. Attempt ALL tasks.
The maximum word count is 1,500 for this assessment, excluding references
The assignment should be submitted via the ‘… Multitasks Assignment 2 – November 2022’ link through Turnitin on the Blackboard.
You may submit your answers at any time up to the submission date, but you MAY NOT resubmit once the deadline elapses.
Completed assignments should be submitted by: Noon, 4th November2022 of which grades are expected to be released by 30th November 2022
Make sure that you only include your Student ID Number on the cover page of your submission. PLEASE DO NOT INCLUDE YOUR NAME.
Use the cover page on Blackboard for the submission (This is compulsory to use, and you will lose marks for not using it).
Sheet 2 of 4
Module Code: ACFI1203
Multitask Assessment 2
TASK 1
(A) Explain and differentiate between Trade Payables and Trade receivables as usually shown in the financial statement of a company. Give examples if possible (3 marks)
(B) Global Scooter Limited manufactures electric scooters in three production departments in their London production centre. The departments are Manufacturing, Finishing, and Packaging. Global Scooter Limited also have three service departments, namely: Quality Control, Stores and Maintenance. Get Help in assignments in UK now !!! The company uses an absorption costing system to analyse product costs, and you have been supplied with the following information about the production departments as indicated in Table 1 below:
Table 1
Base
Manufacturing
Finishing
Packaging
Total
Number of employees
30
12
16
58
Machinery value (£s)
120,000
70,000
70,000
260,000
Factory area (square metres)
230
240
300
770
Factory volume (cubic metres)
28,000
43,000
42,000
113,000
Water usage (litres)
17,000
14,000
13,000
44,000
Machine hours
94,000
58,000
29,000
181,000
(B1) Global Scooter Limited estimates to spend £140,000 on heating the factory during the 2022 financial year. Calculate the heating cost that should be allocated to each of the three production departments (5 marks)
The following additional information has been supplied in Tables 2 and 3, respectively:
Table 2
Manufacturing
Finishing
Packaging
Maintenance
Stores
Quality
control
Annual
£4,800,000
£3,700,000
£1,800,000
£700,000
£950,000
£900,000
overheads
Table 3: % Usage of service departments
Manufacturing
Finishing
Packaging
Maintenance
Stores
Quality
control
Maintenance
60%
20%
10%
0%
10%
0%
Stores
40%
40%
10%
0%
0%
10%
Quality
50%
30%
20%
0%
0%
0%
control
(B2) Using the information provided in the tables above about the annual overheads and usage of each service by the production and other service departments, and if the overheads allocated to the three service departments are reallocated to the three production departments based on usage, reallocate the service. overheads to determine the total overheads after reallocation for each of the three production departments.
(22 marks)
(Task 1 Total – 30 Marks)
Sheet 3 of 4 Module Code: ACFI1203
Multitask Assessment 2
TASK 2
Global Scooter Limited also produces special helmets for scooter riders in one of their production hubs located in Germany. The forecasts for the 2022 financial year are that fixed costs will be £24,000,000, variable costs per helmet will be £400, and sales price will be £570 per helmet. Sales for the year are forecasted at 950,000 helmets. Get HND Assignment help services !!
(A) How many helmets will have to be produced and sold to break even in the German production hub? (6 marks)
(B) Calculate the company’s margin of safety as a percentage of sales (8 marks)
(C)The Managing Director of the Germany production hub has declared that the profit target for the year 2022 is to be £80,000,000. How many helmets does the facility need to make and sell to achieve that target profit? (8 marks)
(D)The Directors of Global Scooter Limited were advised by the company’s external accountant that for the company to be successful, they have to produce at a higher operating profit level. Provide a brief note for the directors that explains what ‘Operating Proft’ means and how this can be achieved (Maximum 100 words)
(8 marks).
(Task 2 Total – 30 Marks)
Sheet 4 of 4 Module Code: ACFI1203
Multitask Assessment 2
TASK 3
The directors of Global Scooter Limited are considering investing in producing a type of e-bike to serve an African Market. The project is estimated to have the following cash flows in the five (5) year period, and the company has a required rate of return of 20%.
Year
Net Cash Flow (£millions)
0
Investment cost
4,900,000
1
Net cashflow
4,400,000
2
Net cashflow
2,350,000
3
Net cashflow
900,000
4
Net cashflow
600,000
5
Net cashflow
400,000
5
Residual value at project end
600,000
TSM08113
(A) What is the payback period for the project? (3marks)
(B) Calculate the Accounting Rate of Return (ARR) for the project (18 marks)
(C) Calculate the Net Present Value of the project (11 marks)
(D) Based on the NPV calculation,advise the directors of Global Scooter Limited whether or not they should undertake the project (2 marks)
(E) List four (4) advantages of the ARR appraisal technique in investment appraisal (6 marks)