Case Study PROGRAMME Bachelor of Business Administration Bachelor of Commerce in Supply Chain Management Bachelor of Commerce in Retail Management Bachelor of Commerce in International Business MODULE

Case Study PROGRAMME Bachelor of Business Administration Bachelor of Commerce in Supply Chain Management Bachelor of Commerce in Retail Management Bachelor of Commerce in International Business MODULE Financial Planning and Control YEAR 3 (Three) INTAKE January 2024 Semester 1 Marks 30 Answer ALL questions. [30 MARKS] Read the following case study and answer the questions: FINANCIAL PROJECTIONS AND CAPITAL EXPENDITURE OF ELSIES LIMITED Elsies Limited is a nationally recognised supplier of catering equipment. It offers safe and secure shopping via its online store and its state-of-the-art premises in each of the provinces of South Africa. The company offers a wide selection of catering equipment and supplies at competitive prices. The target market includes restaurants, hotels, hostels and spaza shops. Their products carry an industry-leading warranty that is backed by good after-sales service and availability of spares. The company was established in 2015 with an authorised share capital of 1 500 000 ordinary shares of which 900 000 were issued at R2 each at the initial public offering in 2015. The financial manager and her team were in the process of forecasting the financial performance for 2024 and financial position of the company as of 31 December 2024. The starting point was the following figures that were obtained from the financial statements for the year ended 31 December 2023: The sales amounted to R9 600 000, and the cost price of the goods sold was R7 200 000. Operating expenses totaled R1 200 000 whilst the company tax amounted to R336 000. The carrying value of the fixed assets was R4 200 000 whilst the inventories, trade debtors and cash reflected values of R1 200 000, R1 800 000 and R600 000 respectively. The ordinary share capital balance remained unchanged since the establishment of the company in 2015 whilst the undistributed profits of the company accumulated to R2 100 000. An amount of R2 400 000 was owed to Jip Bank for a long-term loan. The amount owed to trade creditors was R1 467 000 and the company tax payable to SARS was R33 000. The following predictions were made for the financial year ended 31 December 2024: Sales are expected to increase by 25%. Seventy-five percent (75%) of the total sales is estimated to be on credit. Company tax will be calculated at 27% of the pre-tax profit and 10% of this amount is expected to be unpaid on 31 December 2024. A final dividend of R400 000 is expected to be declared on 31 December 2024, and is payable during 2025. The unsold shares are expected to be issued on 31 March 2024 at R3 each. The amount owed by trade debtors will be based on a collection period of 54.75 days. The company’s closing inventory and the amount owed to trade creditors are expected to change directly with the change in sales in 2024. A new machine with a cost price of R700 000 will be purchased during January 2024. Depreciation for 2024 (included in the operating expenses) is expected to amount to R300 000. R760 000 will be paid to Jip Bank during 2024 and this amount includes R360 000 for interest. The cash balance must be calculated (balancing figure). Elsies Limited is considering the purchase of a machine to manufacture some of the spare parts for the catering equipment during 2025. The company desires a minimum required rate of return of 12%. The machine will cost R2 000 000 plus R400 000 for installation and is predicted to have a useful life of five years. A salvage value of R100 000 is estimated. The machine is expected to generate cash inflows of R800 000 per year but will require the employment of two new machine operators at R100 000 per year for each operator, and it will require maintenance and repairs averaging R40 000 per year. Depreciation will be calculated using the straight-line method. QUESTION 1 Prepare the following pro forma statements: 1.1 Statement of Comprehensive Income for the year ended 31 December 2024 using the percentage-of-sales method. (4) 1.2 Statement of Financial Position as of 31 December 2024. (14) QUESTION 2 Refer to the investment opportunity for 2025 and calculate the following. (Ignore taxes.) Where discount factors are required, use the four decimals present value tables that appear in the module guide. 2.1 Accounting Rate of Return on average investment (expressed to two decimal places). (3) 2.2 Benefit Cost Ratio (expressed to two decimal places). (4) 2.3 Internal Rate of Return (expressed to two decimal places). Your answer must reflect two NPV calculations (using consecutive rates/percentages) and interpolation. (5) THE END

Share This Post

Order a Similar Paper and get 15% Discount on your First Order

Related Questions

Create a 9-slide presentation in which you analyze cost accounting practices to make a recommendation about whether or not to accept a purchase offer at a lower price than normal. You may write a 2–3

Create a 9-slide presentation in which you analyze cost accounting practices to make a recommendation about whether or not to accept a purchase offer at a lower price than normal. You may write a 2–3 page supporting report. Collapse AllIntroduction This portfolio work project will help you to assess a

Write 200–250 words that respond to the directions below with your thoughts, ideas, and comments. Be substantive and clear, and use examples to reinforce your ideas. Accounting is a part of every type

Write 200–250 words that respond to the directions below with your thoughts, ideas, and comments. Be substantive and clear, and use examples to reinforce your ideas. Accounting is a part of every type of business. If you understand accounting, you can work in healthcare, retail, management, or human resources; run

THIS IS THE LINK FOR THE FILE: https://www.sedarplus.ca/csa-party/records/document.html?id=48bbfe48911eb1a16332bf1b39329e948d259a14b05a292d10873b16f3300768 STEP 2: Collect all relevant documents to

THIS IS THE LINK FOR THE FILE: https://www.sedarplus.ca/csa-party/records/document.html?id=48bbfe48911eb1a16332bf1b39329e948d259a14b05a292d10873b16f3300768 STEP 2: Collect all relevant documents to be able to answer the following in (0.50 each correct answer to items 1 to 10 and bonus questions 1 and 2) Part 1: for the period ending December 31st, 2024 find: Q1 Income before

ACC 1100 Introductory Financial Accounting Term Project Instructions and Templates Instructions to students: This group term project consists of two sections. In section 1 (5% of the total

ACC 1100 Introductory Financial Accounting Term Project Instructions and Templates Instructions to students: This group term project consists of two sections. In section 1 (5% of the total grade), you are required to calculate ratios of General Motors Company (hereafter, GM) and Tesla Inc. (hereafter, Tesla) for year ended

I have attached 3 pdf . one is question . One is for tutorial. One is question sheet. It’s healthcare analytic subject. I don’t know what to do .

Incremental Analysis Download the Unit VI Assignment Excel worksheet and complete the following problems on the worksheets. Each problem is designated by a worksheet in the tabs at the bottom of th

Incremental Analysis Download the Unit VI Assignment Excel worksheet and complete the following problems on the worksheets. Each problem is designated by a worksheet in the tabs at the bottom of the file. Worksheet Problem 1 Gulf Coast Paddle produces paddleboards for retailers in the United States. The cost of

Payroll cycle assessment word doc – Attached Payroll Process Template – Attached Complete Payroll Process Assignment – attached is the word document with the instructions for xlsx spreadsheet.

Deductions & journal Entries – attached Employer’s Annual Pay Tax Return Assessment word doc. has instructions for the: Attached employer’s Annual FUTA Tax Return – Attached Schedule A – Attached

Deductions & journal Entries – attached Employer’s Annual Pay Tax Return Assessment word doc. has instructions for the: Attached employer’s Annual FUTA Tax Return – Attached Schedule A – Attached

I have a project due August 3rd For my Financial Management class. I have attached the file for the rubric. I want to do it on the company Adidas.

Therapeutic Meal Plan Presentation for Gastrointestinal Disorders NRG275 – NutritionAssignment Title: Therapeutic Meal Plan Presentation for Gastrointestinal DisordersDue Date: [Insert Date]Submission

Therapeutic Meal Plan Presentation for Gastrointestinal Disorders NRG275 – NutritionAssignment Title: Therapeutic Meal Plan Presentation for Gastrointestinal DisordersDue Date: [Insert Date]Submission Format: PowerPoint Presentation (.pptx or .pdf) Dear Students, You are required to create a PowerPoint presentation on therapeutic meal planning for gastrointestinal (GI) disorders. This assignment is designed to

Module 4 – SLPEthics and TrendsAssignment OverviewEthical Dilemma Understanding how to address ethical dilemmas in accounting, even if you’re not in the accounting department, is important for organiz

Module 4 – SLPEthics and TrendsAssignment OverviewEthical Dilemma Understanding how to address ethical dilemmas in accounting, even if you’re not in the accounting department, is important for organizational integrity. It ensures compliance, fosters transparency, and protects the company from legal and reputational risks. Ethical awareness supports responsible decision-making across all

Module 4 – CaseEthics and TrendsAssignment OverviewTrends The evolving role of AI in accounting automates tasks, reduces errors, and enhances decision-making, allowing non-accounting professionals to

Module 4 – CaseEthics and TrendsAssignment OverviewTrends The evolving role of AI in accounting automates tasks, reduces errors, and enhances decision-making, allowing non-accounting professionals to focus on strategic business activities. Big data enables faster, more accurate financial decisions, helping professionals interpret trends and optimize resource use. At the same time,

Write a 1–2 page executive summary, along with an appendix of supporting information, in which you analyze an organization’s financial performance as well as its level of risk for lending and make and

Write a 1–2 page executive summary, along with an appendix of supporting information, in which you analyze an organization’s financial performance as well as its level of risk for lending and make and present a recommendation to help leadership make a loan decision. Collapse AllIntroduction This portfolio work project will

Module 1 – CaseEquilibrium, Supply and DemandAssignment Overview Supply and Demand in the Real WorldA commodity is the focus of this case which uses real data for price fluctuations over 6 months. You

Module 1 – CaseEquilibrium, Supply and DemandAssignment Overview Supply and Demand in the Real WorldA commodity is the focus of this case which uses real data for price fluctuations over 6 months. You will research reasons for the changes and develop a multifaceted economic analysis. Case 1 Resources Introduction to

Computing Salaries Assignment – Assignment Attached Employer Quarterly Payroll Tax Return Assignment .docx & Form 941 – Quarterly Payroll Tax Form.pdf – attached (these go together)

Coronado comlany produces 2 products, flower and planter. flower is a high-volume item totaling 20000 units annually. planter is low-volume item totalling only 6000 unites per year. flower requires 1

Coronado comlany produces 2 products, flower and planter. flower is a high-volume item totaling 20000 units annually. planter is low-volume item totalling only 6000 unites per year. flower requires 1 hour of direct labor for completion, while each unit of planter requires 2 hours. Therefore, total annual direct labor hours

Module 3 – CaseTransfer Pricing and Responsibility CentersAssignment OverviewTransfer Pricing In recent years, high-profile cases involving companies like Apple (Ireland, 2016), Amazon (Luxembourg. 20

Module 3 – CaseTransfer Pricing and Responsibility CentersAssignment OverviewTransfer Pricing In recent years, high-profile cases involving companies like Apple (Ireland, 2016), Amazon (Luxembourg. 2017), and Starbucks (UK, 2012) have highlighted the risks of using aggressive transfer pricing to minimize taxes. These companies faced public backlash and government scrutiny for shifting

Module 3 – SLPTransfer Pricing and Responsibility CentersAssignment OverviewBlock Chain Blockchain enhances financial transactions by providing transparent, secure, and immutable records, reducing in

Module 3 – SLPTransfer Pricing and Responsibility CentersAssignment OverviewBlock Chain Blockchain enhances financial transactions by providing transparent, secure, and immutable records, reducing intermediaries and fraud risk. In accounting, it automates auditing, reduces errors, and increases transparency with real-time, tamper-proof data. Blockchain also plays a critical role in preventing financial fraud