MAA103 – Accounting for Decision Making
Trimester 1, 2019
Assessment 2 & 3 – Business Planning and Budget Reports
DUE DATE AND TIME: Week 10, Friday 10th May 2019, 5:00 PM
PERCENTAGE OF FINAL GRADE: Assignment 2 – Video Presentation has a total of 25 marks that will be scaled back to 5% of your final grade calculation.
Assignment 3 – Budget Report has a total of 75 marks that will be scaled back to 15% of your final grade calculation.
In total, this project contains 25 + 75 = 100 marks that will be worth 20% of your final grade in this unit.
Learning Outcome Details
Unit Learning Outcome (ULO) Graduate Learning Outcome (GLO)
ULO 1: Describe the accounting processes and how accounting information can be effectively used for making informed business decisions. GLO1: Discipline-specific knowledge and capabilities.
ULO 3: Use visual and other technology such as spreadsheets to communicate researched information. GLO3: Digital literacy
ULO 4: Describe and justify the importance and use of Cost/Volume profit analysis and budgeting in the context of operating a business. GLO1: Discipline-specific knowledge and capabilities.
GLO4: Critical thinking
Students who submit their work by the due date will receive their marks and feedback via email within 14 business days (before Friday 31st May 2019, 5PM)
Group Work/Individual Work
1. The assignment may be completed individually or as a group of two or three students. You will need to find your own group members and/or decide if you want to work on your own. We highly recommend you work together in groups!
2. Register your group in Cloud Deakin by enrolling yourself into a Group number which you and your group members nominate.
3. If you are working individually you still need to register yourself into a group number so that you can submit your work.
4. You can form a group with any student regardless of your other group members’ mode of study - as long as the other student is enrolled in the unit, its fine to register a group together.
5. Once you find your group members you will need to register your group formally via the MAA103 Cloud Deakin Site - Tools - Groups.
6. You will only need to register for ONE group across both Assignment 2 and Assignment 3.
7. All individual/group registrations will close off by 5pm Friday 3rd May 2019 after which you will need to contact the Unit Chair to provide an appropriate reason for missing the deadline for registration. If the explanation is unsatisfactory or if you fail to contact the teaching team before the due date you will receive no marks for both assessment tasks. A penalty in marks will be applied for those who fail to register by the appointed deadline.
8. Each member involved in the group must be included in the preparation of this work. Any incidents of ‘free-loading’ should be reported to the Unit Chair with sufficient evidence. To this end, we would strongly suggest planning out clear goals/guidelines at the very beginning so that you all members of your group are aware of the responsibilities and expectations.
See here for how to register into a group: https://youtu.be/rfmkef8alYw
Assignment 2 & 3 Case-Study Description:
You (and your team) work in a boutique firm called ‘Business Advisory Pty. Ltd.’, a business that provides advisory services to other businesses. Your role in the firm is that of a business consultant; i.e. you provide business advice to business clients. To this end, you are often required to produce budgetary reports and present such reports to clients.
Mr. James Hunter and Dr Olivia Ng own an Optometry business trading under the name “i-Optometry” and they have approached you (and your team). Being a brick and mortar store located in Burwood, Victoria, i-Optometry is a business that has traditionally focused on selling eyewear such as sunglasses and prescription glasses. The business also provides optometry services to customers, mainly a comprehensive eye examination. James is in charge of the management of the business while Dr Ng, manages the optometry aspects of the business.
As part of their business operations, i-Optometry retails the following types of eyewear:
• Sunglasses retail on average for $200 per pair of glasses. It costs $60 per pair and the business purchases these from a local supplier.
• Prescription reading glasses retail for $150 each. It costs $80 to secure from the same local supplier.
i-Optometry also provide comprehensive eye tests to clients who wish to assess eye health. The cost of a comprehensive eye test is $75.
As part of the eye-test, the Optometrist will examine the eyes, detect, diagnose and manage vision problems, and assess eye health. Optometrists can prescribe and fit glasses or contact lenses. Optometrists can also advise you on many aspects of your eye health.
Recently, business at i-Optometry has been turning over a sizable profit through word-of-mouth only, i.e. they have spent very little on advertising. Details about the business’ have been uploaded to the firm’s servers and are available for you to view . In addition, you have also been provided with the following information:
• Both James and Olivia are partners within the business and draws an amount of $2000 per month each. They plan on increasing their drawings to $4,000 each per month starting in January 2020.
• As the manager, James keeps a close eye on inventory management and would like to always maintain a monthly ending inventory requirement of 30% of next month’s sales. Additionally, all purchases with the current supplier are on a credit basis with 50% of the account settled in the same month of purchase and the remaining 50% settled one month after the month of purchase.
• The business typically will have 80% of their sales as cash, with the remaining 20% on credit. Of the credit sales, 70% is collected in the month of sale, 20% is collected one month after the sale, and 10% is collected two months after the sale.
• All customers coming in for an eye check are assumed to pay cash 100% of the time as the business does not provide bulk billing.
The business has a range of equipment and other fixed assets such as2:
• Specialized optometry equipment to provide the comprehensive eye-tests. On average, the equipment costs $11,000 and generally is expected to last 5 years with zero residual value.
• Other office equipment has a historical cost of $25,000 and depreciates at 25% per annum.
• Store furniture and fittings were originally purchased at $65,000 and depreciate at 10% per annum.
The clients have been thinking of stepping their business up to the next level and so they have approached your firm for some business advice. Specifically, they have listed some potential projects they had in mind as follows:
#1 Expansion Project: The owners believe that they can improve business by expanding their storefront location. Specifically, they would like to increase the floorspace of the existing premises to include some additional display cabinets and expand the number of eye-test rooms to reduce customer wait-time. Out of all the projects this has the greatest initial capital requirements.
#2 Cost Management Strategy: James suggests that selling prescription glasses does not produce enough margin. He has proposed that they focus on the sunglasses and other casual eyewear products and further increase the margins by changing suppliers. The new supplier will provide slightly inferior products but will be much cheaper than the current supplier. James would also introduce a number of other cost-cutting initiatives such as reduced wages, and energy usage.
#3 Advanced Marketing Campaign Olivia has suggested that the current business model works well but they simply need to expand marketing. She believes that if more clients came to the business they can improve revenues. Specifically, if the business paid for an advertising agency to help set up an online portal, advertise in the local newspaper, put up social media ads, etc. more people will come to do eye tests. Based on her estimates, Olivia believes that while eye-tests count for a smaller proportion of revenue, they are strongly tied to the sale of prescription glasses, so the business should focus on eye-care rather than retailing sunglasses. Note that the cost of this project is a repeated amount that the business will need to pay every month on top of any existing marketing expenses.
The exact data/details on the various changes to the business model can be found in the Excel spreadsheet “MAA103 Budgeting Assignment.xlsx” after you enter in your Student ID along with the group number and select the project that you and your team have nominated to analyse.
Assessment 2: Video Presentation Requirements
Video Presentation (25 marks):
As the clients are too busy to meet you in person, the clients have requested you to create a brief 4-5 minute video presentation on the proposed projects. Specifically, the clients would like to hear your opinions on the weaknesses/concerns surrounding each of the above proposals.
Your manager would like to remind you that this is a formal business client that will be bringing in large amounts of business to the firm. You are expected to be professional and dress for the occasion.
Where possible, your manager would also like you to ensure that the presentation is flawless, and if that means editing the video, post-production, then so be it. He has recommended that you speak to the video editing department for more help should you need it (i.e. library services available at www.deakin.edu.au/library).
Your manager will be assessing the video not only on the content (10 marks) but also on the overall quality of the video itself (15 marks).
Once the video has been completed, you are to upload the video to one of the popular video hosting platform such as DeakinAir** (www.deakinair.edu.au), or YouTube (www.youtube.com), or Vimeo (www.vimeo.com).
Please note you will then need to copy/paste the video link into the comment section when you submit the other files into the assignment drop box folder.
Please ensure the video is set to “unlisted” so that only someone with the link can access the video and it is not available on the public search domain. Setting to public will mean anyone can search for the video, setting to private will mean only people with the password will be able to access the video.
** We would prefer you to use DeakinAir where possible but if you prefer to use YouTube or Vimeo that is fine as well – note that no support for other platforms will be provided. For instructions on how to use DeakinAir see https://video.deakin.edu.au/media/t/1_x2qnbiq7
Assessment 3: Budget Report Requirements
Budget Report Spreadsheet (60 marks):
Your manager would like you to examine and assess the financial viability of one of the proposed projects. Specifically, your manager would like you and your team to complete the
‘budgeted profit and loss’ and the ‘cash budget’ for the project your team has selected and for the period between Jan 2020 to Dec 2020 inclusive.
**For this part of the assessment, you need to complete the Cash Budget and Budgeted Profit and Loss. All the 'other' budgets will not be marked and have only been included to help you carry out any calculations you might need.
Your manager would like you to use the ‘usual’ budgeting template which can be found online via Resources - Assessments - Assessment 2 & 3 -Video Presentation & Budget Report “MAA103 Budgeting Assignment.xlsx”.
To help you complete the budgets, a data “FactSheet’” for the business can be found in the same budget report excel spreadsheet under the worksheet ‘FactSheet’. Note these values are based on your Student ID and group numbers so please make sure you enter in the correct information first before reading this Factsheet.
Assessment 3: Budget Report Requirements (continued…)
Written Report Document (15 marks):
In addition to the budget report spreadsheets you have to complete, your manager would like a brief 1-2 page executive summary addressed to the clients (between 500-1000 words).
In the document, you should outline the budget report spreadsheet to help guide the clients through the spreadsheet itself. Your summary should highlight the key findings, specifically your evaluation of the proposal for the business, and indicate any key considerations the owner’s need to consider.
Additionally, your manager would like you and your team to emphasize the importance of how budgeting is useful in the context of operating a business. (i.e. you need to try to convince the clients that this budget report is an important part of the decision-making process).
Submission Checklist and Instructions:
Video Presentation Uploaded to Video Hosting Platform Tick if completed
Video Presentation URL Link copy and pasted into the submission comment box. Tick if completed
1 x Executive Summary (approx. 1000 words) in Microsoft Word document and submitted into the MAA103 Assignment 2&3 Submission box. Tick if completed
1 x Budget Report completed in Microsoft Excel and submitted into the MAA103 Assignment 2&3 Submission box. Tick if completed
1. This assessment is to be submitted ONLINE ONLY into the T1 2019 MAA103 Assessment 2&3 drop box folders.
IMPORTANT you will need to submit your assignment into the correct folder based on which project you and your group decided to do. i.e.
T1 2019 MAA103 Assignment 2&3 - Proposal #1 Expansion Project or,
T1 2019 MAA103 Assignment 2&3 - Proposal #2 Cost Management Strategy or,
T1 2019 MAA103 Assignment 2&3 - Proposal #3 Advanced Marketing Campaign
PLEASE DO NOT SUBMIT INTO ALL THREE FOLDERS. INCORRECT FOLDER SUBMISSIONS WILL INCUR A PENALTY IN MARKS!
2. Any work you submit may be checked by electronic or other means for the purposes of detecting collusion and/or plagiarism.
3. When you are required to submit an assignment through your CloudDeakin unit site, you will receive an email to your Deakin email address confirming that it has been submitted. You should check that you can see your assignment in the Submissions view of the Assignment dropbox folder after upload, and check for, and keep, the email receipt for the submission.
4. Only one member of each group needs to submit on behalf of the group.
Penalties for late submission: The following marking penalties will apply if you submit an assessment task after the due date without an approved extension: 5% will be deducted from available marks for each day up to five days, and work that is submitted more than five days after the due date will not be marked. You will receive 0% for the task. 'Day' means working day for paper submissions and calendar day for electronic submissions. The Unit Chair may refuse to accept a late submission where it is unreasonable or impracticable to assess the task after the due date.
For more information about academic misconduct, special consideration, extensions, and assessment feedback, please refer to the document Your rights and responsibilities as a student in this Unit in the first folder next to the Unit Guide of the Resources area in the CloudDeakin unit site.
Building evidence of your experiences, skills and knowledge (Portfolio) - Building a portfolio that evidences your skills, knowledge and experience will provide you with a valuable tool to help you prepare for interviews and to showcase to potential employers. There are a number of tools that you can use to build a portfolio. You are provided with cloud space through OneDrive, or through the Portfolio tool in the Cloud Unit Site, but you can use any storage repository system that you like. Remember that a Portfolio is YOUR tool. You should be able to store your assessment work, reflections, achievements and artefacts in YOUR Portfolio. Once you have completed this assessment piece, add it to your personal Portfolio to use and showcase your learning later, when applying for jobs, or further studies. Curate your work by adding meaningful tags to your artefacts that describe what the artefact represents.