Advanced Diploma in International Business (Evening)

Batch: AIBEM 0611A

Module: Financial Management
Course Assignment
Mr. Philip Tan, is the owner of Happy Trading Pte. Ltd, a company trading in hand
phones and computers.
Mr. Tan is pleased that his company's sales has increased by 35% for 2015. However
over the corresponding period net profit has fallen by 10%.
The summarised results relating to the last three financial years are as follows:
Extracts from Profit and Loss Statement for Year ended 31 December:
2013 2014 2015
$ $ $
Sales 90,000 100,000 135,000
Cost of sales 74,000 75,000 107,000
Gross profit 16,000 25,000 28,000
Administrative overheads 3,000 5,000 12,000
Net Profit 13,000 20,000 16,000
Extracts from the Balance Sheet as at 31 December:
2012 2013 2014 2015
$ $ $ $
Fixed assets:
At cost 155,000 165,000 190,000 220,000
Provision for depreciation 42,000 45,000 49,000 53,000
113,000 120,000 141,000 167,000
Current assets:
Stock 3,000 4,000 7,000 30,000
Debtors 14,000 19,000 15,000 20,000
Balance at bank 2,000 1,000 3,000 --------
19,000 24,000 25,000 50,000
Current Liabilities:
Creditors 5,000 4,000 6,000 15,000
Bank overdraft ------- ------- ------ 15,000
5,000 4,000 6,000 30,000
Being a very cautious person Mr. Philip Tan has asked his accountant to brief report on
the companys financial results. The report should include:-
(a) A schedule of six accounting ratios for each of the above three years. Explain
the use and the method of calculation of these six accounting ratios.
(12 marks)
(b) Using the financial ratios calculated in (a) comment on the future course of
action the company might take to improve the its financial performance.
(8 marks)
Course: Advanced Diploma in International Business

Module: Financial Management

Batch: AIBEM 0611A

Submission Date: 15 June 2016 to lecturer

Instructions:

1) This assignment, which carries 20% of the total marks for the module, is
compulsory for students taking the July 2016 examination.

2) The assessment criteria are:

A) Substance
B) Originality of work
C) Layout of report, use of examples where appropriate.

3) Penalty scheme for late submission of assignment

1-2 days late: deduct 20% from marks awarded

3-4 days late: deduct 40% from marks awarded
5-6 days late: deduct 60% from marks awarded
Up to 7 days late deduct 80% from marks awarded

Assignment that is submitted after seven calendar days from dateline will not be
graded. No exemption will be made to this policy.

4) Marks will be deducted for any similarities between individual assignments.

5) The format of the assignment should be as follows:

a) Front cover stating the:

i) Module name
ii) Student's name in full, passport no. for international students and NRIC
number for Singaporeans.
iii) Course, module and batch number. Submission date

b) Contents page

7) Word limit: 1200 words (maximum) Double spacing please