TOPSIM –

P General Management
Participants’ Manual – Part II
Initial Situation
Version 14.2
Standard Scenario

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 TOPSIM® – General Management

Table of contents

1 Decisions ......................................................................................................................................... 1
2 Participants‘ reports ....................................................................................................................... 2
2.1 No. 2 Market results and Value of Inventory ..................................................................................... 2
2.2 No. 3 Production Lines – Environmental Technology........................................................................ 3
2.3 No. 4 Human Resources and Product Development......................................................................... 4
2.4 No. 5 Cost Type, Cost Center Accounting ........................................................................................ 5
2.5 No. 6 Cost Accounting (Unit-of-output costing) ................................................................................. 6
2.6 No. 8 Profit and Loss Statement and Balance Sheet ........................................................................ 7
2.7 No. 9 Financial Report and Cash Flow Statement ............................................................................ 8
2.8 No. 11 Out-of-Line Situations .......................................................................................................... 10
2.9 No. 12 Market Research Report I.................................................................................................... 11
2.10 No. 13 Business Report on the Industry.......................................................................................... 12
 TOPSIM® – General Management

1 Decisions

You will find information about the current situation of the COPYFIX Inc. below. To get a first over-
view, you will be provided with the decisions taken by the previous board for period 0. Moreover,
you will be also provided in the following chapter with all necessary reports of COPYFIX Inc. of
period 0 to analyze strengths and weaknesses of COPYFIX Inc. This analysis should be the basis
of your decision-making process.

COPY I
Market 1
Price (unit) 3,000 EUR
Sales

Advertising 6.0 mEUR

Corporate Identity 2.0 MEUR Market 1

Market res. report Yes: X Sales 100 No. of ppl.

Technology Ecology Value analysis

R&D

COPY I 34 No. of ppl. 2.5 mEUR 1.0 mEUR

COPY I
Purch-
asing

Input Materials / Parts 30,000 Units

COPY I
Production Volume 40,000 Units

Production Lines Type A Type B Type C

Investment ---- No. of new Line(s) --- No. of new Line(s) --- No. of new Line(s)
Disinvestment --------- No. of Line(s) --------- No. of Line(s) --------- No. of Line(s)
Production

Maintenance 1.5 mEUR / Line ------ mEUR / Line ------ mEUR / Line
Rationalization 0 mEUR / Line ------ mEUR / Line ------ mEUR / Line

Process optimization 0 mEUR

Investments in Environmental Technology 1.5 mEUR
Production Staff - recruitment / dismissal (-) 50 People

Training 0.5 mEUR

Non-salary staff costs 40.0 %

Short Term-Loans 27 mEUR

Financing

Long-Term Loans 0 mEUR

Purchase of securities 0 mEUR
Dividends 1.0 mEUR

COPY I
Planned

Market 1
figures

Sales revenue 130.0 mEUR

Return of equity 18.0 %
Cash Flow 14.0 mEUR
+

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 TOPSIM® – General Management

2 Participants‘ reports

2.1 No. 2 Market results and Value of Inventory

Note: The valuation of inventory of finished goods (here COPY I) meets the costs of goods
manufactured.

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2.2 No. 3 Production Lines – Environmental Technology

Note: Fully depreciated production lines are still available for production. The maintenance
factor is displayed as a figure that has been rounded up.

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2.3 No. 4 Human Resources and Product Development

Note: The product development expenses of 1.5 mEUR spent on "Technology" corre-
sponds to the R & D cost center’s “Wages and Salaries” expense of 1.50 mEUR.

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 TOPSIM® – General Management

2.4 No. 5 Cost Type, Cost Center Accounting

Note: Cost type accounting includes all of the costs incurred by the company.

The overhead cost of 41.50 mEUR is the total cost for all of the cost centers to-
gether.

Direct costs are costs which are tied directly and immediately to COPY I.

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2.5 No. 6 Cost Accounting (Unit-of-output costing)

Note: Cost unit accounting works out step by step (job order costing) the costs in-
curred for COPY I.

The finished products of COPY I enter the finished goods inventory at the
value of the cost of goods manufactured (CGM).

The cost of production is the total cost incurred for one unit of COPY I.

Direct costs: costs traced directly to the product.

Overhead costs: costs that are traced to a cost center (see previous report.)

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2.6 No. 8 Profit and Loss Statement and Balance Sheet

Increase / Reduction of the = Closing Inventory 10.39 mEUR

finished goods inventory - Opening inventory 16.16 mEUR
= Change of finished goods inventory –5.77 MEUR,
in other words, the finished goods inventory decreased during
the period by 5.77 mEUR.

Material expenses = Material for the production of COPY I

= Material (input materials/parts) + Factory materials
= Cost of direct materials

Other expenses = Total costs which appear under "Other costs" in cost-type accounting

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2.7 No. 9 Financial Report and Cash Flow Statement

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Notes on the financial report:

Sales * Percent of payments received in the

Cash in from sales, current period
period

See “Accounts receivable” from previous peri-

Cash in from sales, previous period
od

Corresponds to the item labelled "Other ex-

Other expenses
penses" in the P/L Statement

Opening cash balance + Total cash in

Loan amount required for the period - Total cash out – Minimum closing cash bal-
ance

The Cash-Flow shows a company’s ability to finance new investments without additional capital. It
can be derived by adding depreciation expenses plus the increase in the pension reserve to the
after-tax profit

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 TOPSIM® – General Management
2.8 No. 11 Out-of-Line Situations
Hinweis: The return on equity is calculated on the basis of the owner’s equity at the beginning
of the period.
Planning quality
Planning quality for
the period
Cumulative planning
quality
Earnings value for
the period (mEUR)
Cum. earnings value
(mEUR)
The planning quality index demonstrates the extent to which the
company’s actual performance differs from its plan.
Possible ratings on the index range between –1.0 and +1.0:
Best = +1.0 for an absolute difference of approximately 0.0.
Worst = -1.0 for a large absolute difference.
Sum of the individual planning quality ratings for the period
Cumulative planning quality rating from previous periods
+ Planning quality of period
The earning value of the period is composed of :
Net income for the period (mEUR)
+ (Planning quality of the period * Value of a planning quality point
in mEUR)
The value of a planning quality point is determined by the simula-
tion facilitator.
Cumulative earnings value from the previous periods
+ Earnings value for the period
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2.9 No. 12 Market Research Report I

Note: The R & D expenditures are the sum of the costs for technology, ecology and
value analysis.

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2.10 No. 13 Business Report on the Industry

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