Assessment 2
Accounting for Business Decisions HI5001
Note: This assignment carries 30% weightage. Students not to worry about the marks shown in each section as the marks shown in each section are to help the lecturers mark. Due Date:Week 10 before 5.00 pm.
Group Assignment is divided into 2 Sections: Section A and Section B. Each with 15% marks with a total of 30%. Students are advised to use Microsoft Excel wherever necessary.
Section A.
Requires a group to undertake some research, the assignment aims to develop understanding of financial statements and their use in decision-making.
The task is to analyse and compare 2 publicly listed companies specifically in the same industry,
(use ASXs website to select a company) and be able to understand the structure of financial statements.
· The group needs to give a general overview of the company regarding its Mission Statement, Vision Statement and business structure. (9 marks)
· Review (Compare) the Last 2 years balance sheet (pref: 2011 and 2010) of the 2 companies and indicate the following: (3 marks)
The amount of total current assets
The amount of total non-current assets The amount of total current liabilities
The amount of total non-current liabilities The amount of total stockholders equity
· Review the most recent years(pref: 2011 and 2010) income statement and indicate the following: (3 marks)
? total (operating) revenues
? cost of goods sold (if listed)
? total expenses (before income taxes)
? any non-operating (or extraordinary) gains and losses; and
? Earnings per common share.
· Review the statement of cash flows for the most recent year (pref: 2011 and 2010) and indicate the following: (3 marks)
net cash inflow (outflow) from operating activities;
net cash inflow (outflow) from financing activities;
net cash inflow (outflow) from investing activities; and
net increase (decrease) in cash during the year.
· With the information collected from Balance Sheet, Profit and Loss Statement, and cash flow Statement. Conduct a Horizontal Analysis (within) of each company. Identify the Variance
1
and write a variance report for each of them (Balance Sheet, Profit and Loss Statement, and cash flow Statement). (20 marks)
6) With the information collected from Balance Sheet, Profit and Loss Statement. Conduct a Vertical analysis of the last year 2011 of each company and compare and report on items mentioned in both the reports. (12 marks).
Section B:Q1
2
The following transactions occurred in Canberra limited in 2011.
Issue share capital for $200,000 cash.
Purchased $35,000 of inventory on credit
Paid $28,000 to Accounts Payable
Sold Inventory costing $60,000 for @270,000. All sales are on Credit.
Collected $52,000 from Customers
Prepaid $12,000 rent for the year commencing 1 January 2011.
Depreciated property and equipment for the year using the straight line method (20 per cent per annum).
Dividends declared and paid totalled $30,000
Borrowed $100,000 on 1st July 2010. The loan is due on 30 June 2012 and carries a 10% interest rate. Paid $4,000 interest on this Loan during 2011.
On 1st of November paid $24,000 for an insurance policy covering 1st November 2010 to 31st October 2011.
Paid wages of $90,000; wages of $20,000 had been earned but not paid.
Received interest of $5000 in cash from the bank.
On 31st December 2011:
The unearned revenue account had a balance of $5000
Accrued interest revenue had a balance of $2000.
REQUIRED:
1.
Prepare journal entries for the above transactions. (10 marks)
2.
Prepare Ledgers
(10 marks)
3.
Prepare closing Entries
(10 marks)
4.
Prepare a 10 Column worksheet.
(10 marks)
5.
Prepare an Income Statement and balance sheet for Canberra Limited for the year ending
31st December 2012.
(10 marks)
General Rules and Requirements:
For Section A the report should be prepared by a small group (with a maximum of three to four members) with the contribution of each member specified on the reports title page. Reports must be confined to 3,000 words (+/- 5%). A title page, table of contents page (based on your report headings), introduction, conclusion and list of the references actually cited should accompany your report. Font type should be Arial (size 11), paragraph spacing should be equal to 1.5.
Note: any additional material from external sources that you paste into your report is NOT included in the word limit. Also, ensure it is appropriately referenced.
Dont forget to upload ontoSafe assign, one copy per group (do not upload more than one copy). Also,one hard copy to be handed to the lecturer before the schedule time as mentioned above.