ACCT11059 USING ACCOUNTING FOR DECISION MAKING ASSIGNMENT 2
STUDENT NAME: PIN TZU SHU
STUDENT ID: S0267098
Step 1 : KCQs
Chapter 4 Analysing Financial Statements
-Cash flow from operations and net cash invested into a firm’s operating assets
-How firms “ add value “ to equity investors?
-Express economice profit= ( RNOA- cost of capital ) multiply
RONA=OI/NOA
-What is occupation rights’ meaning?
-Two obvious and different types of activities: operating and financial activities
-Restate two key financial statements: balance sheet and income statement
-Define profit margin=operating income after tax (OI)/Sales
-Define asset trunover (ATO)=Sales/Net operating assets(NOA)
-Return on net operating assets equal Profit margins multiply Asset turnover
What Is the author trying to say?
In this study guide I can see the author is trying to say that predict the future we need to begging with the past as we need to more insights to understanding of a firm’s past and the future must consult
the past. The author provide a good framework to let me know that two common structures for
analysing a firm are the discounted cash flow (DCF) and the economic profit. It is basic to separate operating and financial activities of the firm.
What do I find difficult to understand?
I was find a little bit difficult to understand how can start to restating a firm’s Restating statements of financial position . I thought maybe this part I need to do first and separate operating and financial assets and liabilities of a firm. I have to distinguish which item should I put in OA, OL and FO. But now I already knew how can allocated these item in my firm worksheet.
What do I find confusing?
I was confused 2 parts first is about that restated statement of financial performance, in this part I need to separate my firm’s operating and financial revenue and expenses but I really confusing why gross profit do not need to put in operating revenue? The author did not explain so I was confused. Second part is when I calculated comprehensive net profit after tax (CI) should I calculated discontinued operations together or not as my firm already collapsed so they have this item that is especially another normal operating companies.
What do I find exciting or surprising?
I found it interesting and exciting to know that how can calculate tax benefit. The formula of Tax benefit equal Net interest expense multiply tax rate of the firm. Before I do not know different countries have different paid tax of rate I thought all same paid tax of rate but after I read this chapter I found they are different. For example, New Zealand companies paid tax at the rate of 28% on their profits and Australian companies is rate of 30%.
What do I find boring?
I do not feel boring at all. There were many formulas need to understand that made me more interested as I can use these formulas to do my worksheet and also it help me to understand why I need to restate are the balance sheet and income statement? This is because we can use this financial statement to improve our company in the future.
Step2: Restated Statement of Changes in Equity
Restated Balance Sheet
Restated Income Statement
Commentary and discussion with others
Step3: Identify three products or services
The company provides publishing services and manages events and conferences for both the private and public sector in a range of industries, including IT, finance, engineering, education and sustainability.
PS. My company had been collapses this year and any information relating to this company is very limited. Fortunately, I got suggestions from Martin.
Three of the products that is identified are
Conference - Platinum Sales Price: $100,000
Conference - Silver Sales Price $50,000
Special Event - Standard Sales Price $25,000
Commentary-contribution margins
The contribution margin is a very important number in a company's financial reporting. It is the number that tells you if all of the variable costs are covered and how much is left to cover the fixed expenses. This number is often evaluated on a division or department basis. For example if your company has several divisions, each group's contribution margin will be different. Some of them may helps or detracts from the company’s ability to cover the fixed costs.
Constraints-identify & commentary
Some of the constraints that I can identify were conference/special events organizers are experiencing an environment of ever- increasing competition, rising costs, funding constraints, and greater diversity of thought and objectives for both individuals and organizations. In addition another major constraint was legal issues, the complexity of event organization means there may be legal issues to address before, during and after the event. It is important that you seek professional legal advice before you begin planning for your event.
Step4: Feedback
