Year 13
Unit 7 – Management Accounting
BTEC Business Level 3
Assessor name
Student name
Mr A Lingard
Date issued
Completion date
12th January 2016
26th January 2016
Qualification
Edexcel BTEC Business Level 3 Business
Submitted on
Unit number and title (Credit Value)
Unit 7 - Management Accounting
Assignment title
In this assessment you will have opportunities to provide evidence against the following criteria.
Indicate the page numbers where the evidence can be found.
Assignment title
The purpose of this assignment is to:
3 Be able to use appropriate statistical information to review and predict business Performance Accounting
data: previous period (sales, production costs, profits); information from published financial reports
Statistical information: changes over time; moving averages; seasonal variations; price indices eg Retail
Price Index (RPI); trends to assess and predict business performance
Performance: ratio analysis; liquidity ratios (current ratio, liquid capital ratio); profitability ratios (gross profit
mark-up, gross profit margin, net profit margin, overheads to sales margin, return on capital employed);
efficiency (stock turnover days, debtors’ collection days, creditors’ payment days, fixed assets turnover
ratio, net current asset turnover ratio); capital gearing; previous periods
Scenario
You are working as a trainee small business manager at a branch of a national bank. One of your first tasks is to advise
a new business start-up under the supervision of your manager. This means that before you can advise the client your
work needs to be checked for accuracy by your line manager. To do this your manager has set you a case study task
based on a set of financial accounts.
Sources of information
www.businessstudiesonline.co.uk, www.tutor2u.net, www.ttimes100.co.uk
Criteri
a
refere
nce
P3
M2
To achieve the criteria the evidence must show
that
the student is able to:
use accounting data and statistical information to
measure business performance
Tas
k
no.
Expected
Evidence in
folder
Feedback
assess the implications of different activity levels
using the results of a breakeven analysis for a selected
organisation
Learner declaration
I certify that the work submitted for this assignment is my own and research sources are fully acknowledged.
Learner signature:
Date:
This brief has been verified as being fit for purpose
Andrew Lingard
Assessor
Date
Signature
Internal verifier
Nicola May
Date
Signature
ACTION
Y/N
To be submitted
onononresubmitted
Final Grade
Points
26th January 2016
Criteria
met
Y/N
Task 1:
Your manager has given you the annual accounts for Vodafone. To show that you understand
how to interpret accounts you will need to answer the questions below
P3/M2 – Accounting Information to assess business performance
Profit and Loss
1. Comment on the performance (good and bad) of Vodafone using the following
performance measures over the 3 year trend:
Sales
Cost of Sales
Gross Profit
Profit for financial year
2. What are the most worrying parts of this business based on its financial data? Why
might these problems have occurred?
3. Define and explain the following statistical methods that can help a business to detect
trends:
a. Moving averages
b. Seasonal variations
c. Retail Price Index (RPI)
4. Complete a quick ratio analysis using the following grid:
Ratio
2012
2011
2010
Meaning
Gross profit
ratio
net profit ratio
Current ratio
Acid test ratio
Stock turnover
Average
collection
period
Average
payment
period
5. Explain how the different factors below can influence the figures used in a budget:
a.
b.
c.
d.
e.
f.
g.
h.
i.
production
sales
costs
profits in previous accounting periods
changes over time
moving averages
seasonal variations
price indices (RPI)
performance and trends detected in previous accounting periods.
Additional Information
Ratio Formula
Gross profit
margin
Net profit margin
Gross profit
Sales
Net profit
Sales
x100
x100
overheads to sales Overhead expense (total)
margin
x100
Sales
fixed assets
Sales
turnover
Fixed assets
net asset turnover Sales
Net Assets
capital gearing
Equity
Non-current liabilities
Balance Sheet