Assignment 02 Questions DUE DATE: Thursday 22 May 2014

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Assignment 02 will be marked out of 40 and is worth 4.0% of your final grade.
Overall Presentation
Communication: A high standard of written expression and presentation is expected of your assignment.
Correct spelling and grammar are essential. Discussions should be concise, structured in a logical order,
and relevant to the question. Refer to The Business of Writing: Written Communication Skills for Business
Students by E. Manalo, G. Wong-Toi, and M-L. Hansen, 3
rd
edition.
Referencing: APA referencing is to be used only where necessary however you DO NOT need to reference
either the assignment question or the course book. However, you DO need to reference your textbook (or
any other text) IF you have QUOTED or PARAPHASED it. (See the library course page on the ACCTG
101 Cecil home page for details on how to use APA referencing). Always answer thequestions in your
own words.
Presentation: Typed on A4 paper using Arial font and 11 font size. If calculations or tables are required for
an answer they should be set out neatly and labelled clearly. Bullet point answers are acceptable only if the
whole sentence makes sense. Handwritten assignments are acceptable provided they are legible.
Hand in: Please make sure that you hand your assignment into the correct box. Do not post it in the
RETURN box as it will NOT be marked. The POSTING boxes are directly behind the lift on level 0 in the
OGGB building.
Workings: For any calculation type questions, you should show all workings, no matter how trivial they may
be.
Word Limit: Please stick to the word limit. A 10% leeway will be given, anything over that will receive a
20% penalty.
Plussage: It is important that you attempt this assignment to the best of your ability in order to qualify for
plussage (see page 8 9 of your course book for details).
Question 1 The Accounting System 22 marks
Bruce Barnett runs a small take-away business which also provides catering for business functions.
The balance sheet at the end of April 2014 is shown below. Transactions for the month of May are
also given (ignore taxes).
Bruces Burger Business Balance Sheet as at 30 April 2014
Assets Liabilities & Owners Equity
Current Assets: Current Liabilities:
Cash $ 53,600 Accounts Payable $ 5,700
Accounts Receivable 3,900 Non-Current Liabilities:
Inventory 17,800 Bank Loan 52,600
Non-Current Assets Owners Equity:
Equipment 33,000 Barnett, Capital 50,000
Total $108,300 Total $ 108,300

May 1 Repaid $20,000 on the bank loan.
3 Paid $2,000 to a supplier for inventory purchased on credit in April.
4 Received $1,800 from a customer billed in April for a business function that took
place that month.
Assignment 02 Questions DUE DATE: Thursday 22 May 2014


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5 Sold inventory for $5,040 cash; the mark-up is 20% on cost price.
9 A customer paid a deposit of $500 for a business function that will take place in J une.
11 Purchased equipment for $3,000 and paid cash.
14 Paid rent of $1,000 for the month of May.
20 Paid monthly salaries of $3,750.
25 The owner withdrew cash from the business, $600.
30 Received the bill for electricity consumed in May, $200. This will be paid in J une.
Required:
(a) Prepare a worksheet for the transactions given above. (No template has been provided. For an
example, see the worksheet on page 163 of your course book).
(8 marks)
(b) Prepare a Statement of Cash flows for the month of May and a Balance Sheet as at 30 May
2014. (No template has been provided. For an example, see the worksheet on page 193 of your
course book).
(4 marks)
(c) What adjustments would you recommend the accountant make at the end of the month? Discuss
why they are needed.
(2 marks)
(d) Of the above events, which ones would be different in a cash accounting system as opposed to
the accrual based accounting system used in the preparation of the worksheet. Explain your
answer.
(8 marks)
Question 2 Financial Statement Analysis 18 marks
(a) You have recently graduated from University and are working at a local accounting firm. Your
boss, J olene Madison, has asked you to prepare a memorandum analysing Burger Fuel Worldwide
Limiteds Annual Report 2013. Your mandate includes preparing:

A brief overview of the company;
An assessment of profitability; risk and future outlook; and
A recommendation as to whether to buy shares in the company or not.

In order to find information for the memorandum, you can access the annual report of Burger Fuel
Worldwide Limited for the year ended 31 March 2013 from their website:
http://www.burgerfuel.com/nz/pod-files/pdfs/20130723-burgerFuelNZBFWAnnualReport2013Web.pdf

You realise that for a trend analysis you need to calculate the ratios for at least two years. You
decide to use ending balances rather than average figures as you do not have enough information
to determine the averages for both 2013 and 2012.
Assignment 02 Questions DUE DATE: Thursday 22 May 2014


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A memorandum has a similar structure to an email but is of a more formal style. The heading to
the memorandum provides details with regard to whom, from whom, date and subject. The first
sentence identifies the purpose of the memorandum, the body reports the outcome of your analysis
and the last section concludes the report.
For more information on memorandums refer to pages 104 106 in The Business of Writing: Written
Communication Skills for Business Students by E. Manalo, G. Wong-Toi, and M-L. Hansen, 3
rd
edition.
A rubric has been provided at the end of this assignment to give you guidelines on how to
prepare the memorandum.
Please follow the APA rules for referencing (see Cecil: Library Resources webpage).
(18 marks maximum of 800 words)














Assignment 02 Questions DUE DATE: Thursday 22 May 2014

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SECTIONS Unacceptable=0 Fair = 1 mark per section Good = 2 marks per section Excellent = 3 marks per section Score
1. Overview of the
company.
Is unable to present an
overview of the
company.
Is barely able to
present an overview of
the company.
Is able to present an overview of the
company.
Introduction to the company is
concise.


Is able to present an integrated overview of
the company.
Introduction to the company is concise.
The introduction sets the stage for the
analysis and provides enough background to
make the recommendations understandable.

2. Profitability:
Identifies and
explains clearly the
profitability issue.
Fails to incorporate
financial analysis or
shows limited attempt to
understand the financials.
Is unable to complete the
calculations or spot any
trends.
Is barely able to
complete the
calculations.
Is barely able to spot
any trends.

Completes calculations and notes
differences on financial statements by
number and percentage.
Shows knowledge of ratios and trend
analysis; demonstrates understanding
of firms financial standing.
Can determine at least one trend, and
can relate it to the financial
statements.
Completes all relevant calculations, presents
ratios and financial statement analysis by
category, number and percentage.
Shows good knowledge of ratios and trend
analysis; demonstrates understanding of the
firms financial standing.
Can determine at least two trends, and can
relate themto the financial statements.
Discusses any relevant additional
information.

3. Risk: Identifies
and explains
clearly the
liquidity issue.
Fails to incorporate
financial analysis or
shows limited attempt to
understand the financials.
Is unable to complete the
calculations.
Is unable to spot any
trends.
Is barely able to
complete the
calculations.
Is barely able to spot
any trends.




Completes calculations and notes
differences on financial statements by
number and percentage.
Shows knowledge of ratios and trend
analysis; demonstrates understanding
of firms financial standing.
Can determine at least one trend, and
can relate it to the financial
statements.
Completes all relevant calculations, presents
ratios and financial statement analysis by
category, number and percentage.
Shows good knowledge of ratios and trend
analysis; demonstrates understanding of the
firms financial standing.
Can determine at least two trends, and can
relate themto financial statements.
Discusses any relevant additional
information.

4. Future Outlook None offered Offers an irrelevant
implication for the
companys future.
Offersone implication for the
companys future.
Offers two implications for the companys
future.
Indicates the use of critical thinking.

5. Recommendations None offered Offers
recommendation, but
doesnt offer concrete
reasons.
Offers recommendation and provides
at least one concrete reason.
Offers recommendation that takes all
information into account and offers at least
two concrete reasons.
Provides a logical conclusion, supported by
the ratio analysis.

6. Format of
Presentation
(Memorandum)

Not well organised with
many grammatical and
spelling errors.
No referencing.
Average organisation
with few grammatical
and syntax errors.
Incomplete
referencing.
Neatly presented and well organised,
with few grammatical errors.
Uses the correct structure for a
memorandum.
Analysis is well done.
Almost complete referencing.
Excellent presentation and organisation.
Uses the correct structure for a
memorandum.
Thorough analysis is provided with no
grammatical or syntax errors.
Correct referencing.