Presentation and Viva Assignment 2022
Added on 2022-07-07
24 Pages6242 Words11 Views
Assignment for Presentation and Viva
Submitted To:
Dr. Shyamapada Biswas
Professor of School of
Business
(BBA Program)
Submitted By:
Md Rakib Mia
ID: 170202087
Section: B
Year: 4th year 2nd
semester
Submitted To:
Dr. Shyamapada Biswas
Professor of School of
Business
(BBA Program)
Submitted By:
Md Rakib Mia
ID: 170202087
Section: B
Year: 4th year 2nd
semester
1
Problem-1
The Balance Sheet of the firm from 2014 and 2015 are given. Analyze the cash flow.
Assets 2020 2021 Liabilities
+Equity 2020 2021
Cash 100 150 AP 90 120
Accounts
Receivable 350 320 NP 125 135
Inventory 530 580 Debt 485 245
F.A 1020 950 Equity 1300 1500
T.A 2000 2000 L + E 2000 2000
Required:
Cash inflow Amount Cash outflow Amount
Account Receivable
Decrease 30 Inventory increase 50
Fixed Asset decrease 70 Debt Decrease 240
Account Payable
increase 30
Note Payable Increase 10
Equity Increase 200
Total 340 290
Net cash flow = (Cash inflow - cash outflow) 50
Analyzing the findings.
Account Receivable:
We know that account receivable is the sales where sellers sell their goods or services to customers
on credit. Above the data, we see that account receivable is an inflow figure (i.e. decreased AR
during the period) which means the seller less sold on credit, and collected more from customers.
When company can able to receive accounts receivable then they can invest that to another project.
From the cash flow analysis, the company has had enough cash, so we can say that the company
is in a desirable position at the moment.
Problem-1
The Balance Sheet of the firm from 2014 and 2015 are given. Analyze the cash flow.
Assets 2020 2021 Liabilities
+Equity 2020 2021
Cash 100 150 AP 90 120
Accounts
Receivable 350 320 NP 125 135
Inventory 530 580 Debt 485 245
F.A 1020 950 Equity 1300 1500
T.A 2000 2000 L + E 2000 2000
Required:
Cash inflow Amount Cash outflow Amount
Account Receivable
Decrease 30 Inventory increase 50
Fixed Asset decrease 70 Debt Decrease 240
Account Payable
increase 30
Note Payable Increase 10
Equity Increase 200
Total 340 290
Net cash flow = (Cash inflow - cash outflow) 50
Analyzing the findings.
Account Receivable:
We know that account receivable is the sales where sellers sell their goods or services to customers
on credit. Above the data, we see that account receivable is an inflow figure (i.e. decreased AR
during the period) which means the seller less sold on credit, and collected more from customers.
When company can able to receive accounts receivable then they can invest that to another project.
From the cash flow analysis, the company has had enough cash, so we can say that the company
is in a desirable position at the moment.
2
Inventory:
Inventory means the raw materials, finished goods, etc. of a company kept stored. After calculating
the cash flow statement, we see there the inventory was increased over time. In that case, we can
say that the company purchased and store more products than it sold. It indicates the company’s
cash outlay in the cash flow statement. The company has stored more products it’s a good sign for
that because it will be able to gratify and adapt to the market uncertainty in the near future.
Apparently, we can say that the company is not now in a good position because of outlaying cash.
Fixed Asset:
A fixed asset is a long-term asset that is required for support in the production process. Increases
in fixed assets imply that the company’s production increases from time to time in considering the
view of the company. The fixed asset was decreased by 70 from 2020 to 2021. It indicates that the
cash wasn’t outlaid or company sales their old fixed asset so cash come. Now the manager has
sufficient cash in hand, in that case, he/she will be able to meet the company’s other requirements,
it’s in a good position at present.
Account payable:
Account payable refers to the company purchasing raw material on the account or doesn’t pay
utility bills at the time. Account payable was increased in the cash flow statement. So we can say
that they didn’t pay at time, account payable positively impact the company’s cash flow statement.
They have sufficient cash in hand in resulting in the company can perform well currently.
Notes Payable
Notes payable is a short-term loan. The note payable was also increased, and as a consequence, it
significant positively influence the cash flow statement. In this case, we may say that the company
had taken a short-term loan compared to the previous year which means it was more liability at
the time. At present, the company have adequate cash to operate the business activities. So we may
conclude that the company is in a sound financial condition.
Inventory:
Inventory means the raw materials, finished goods, etc. of a company kept stored. After calculating
the cash flow statement, we see there the inventory was increased over time. In that case, we can
say that the company purchased and store more products than it sold. It indicates the company’s
cash outlay in the cash flow statement. The company has stored more products it’s a good sign for
that because it will be able to gratify and adapt to the market uncertainty in the near future.
Apparently, we can say that the company is not now in a good position because of outlaying cash.
Fixed Asset:
A fixed asset is a long-term asset that is required for support in the production process. Increases
in fixed assets imply that the company’s production increases from time to time in considering the
view of the company. The fixed asset was decreased by 70 from 2020 to 2021. It indicates that the
cash wasn’t outlaid or company sales their old fixed asset so cash come. Now the manager has
sufficient cash in hand, in that case, he/she will be able to meet the company’s other requirements,
it’s in a good position at present.
Account payable:
Account payable refers to the company purchasing raw material on the account or doesn’t pay
utility bills at the time. Account payable was increased in the cash flow statement. So we can say
that they didn’t pay at time, account payable positively impact the company’s cash flow statement.
They have sufficient cash in hand in resulting in the company can perform well currently.
Notes Payable
Notes payable is a short-term loan. The note payable was also increased, and as a consequence, it
significant positively influence the cash flow statement. In this case, we may say that the company
had taken a short-term loan compared to the previous year which means it was more liability at
the time. At present, the company have adequate cash to operate the business activities. So we may
conclude that the company is in a sound financial condition.
3
Debt
Debt is a long-term loan. After calculating the cash flow between 2020 and 2021, we see there the
debt was decreased which means the company’s long-term is less compared to the previous year
thereby reducing the cash and being unable to operate the business activities effectively at the time.
But decreasing debt is good for the company because it’s bears interest.
Equity
Equity is simply defined that is the owner’s capital. Above the cash flow statement, equity was
climbed by 200 from 2020 to 2021 resulting in a positive effect on the statement of a company.
Because owner’s equity increases in resulting the company can reinvest their money in a new
project. It is undoubtedly said that the company is financially solid in this aspect.
Net cash flow
Finally, after calculating and analysing the cash flow statement, we notice that the net cash flow
was positively changed by 50 from 2020 to 2021. So, it may be stated that the company's sales are
increasing. When sales increase, the company's revenue increases as well, which results in an
increase in cash on hand as well. We may conclude that the company’s financial performance
currently was solid as a whole.
Problem-2
The following Balance Sheet is given:
Assets 2019 2020 2021
Current Assets
Cash 90 135 155
Accounts Receivable 178 115 290
Inventory 301 370 675
Fixed Assets 2731 2880 2880
Total Assets 3300 3500 4000
Liabilities and
Owners’ Equity
Accounts Payable 175 220 180
Notes Payable 355 240 540
Long Term Debt
(Liability)
570 540 780
Owner’s equity 2200 2500 2500
Total 3300 3500 4000
Debt
Debt is a long-term loan. After calculating the cash flow between 2020 and 2021, we see there the
debt was decreased which means the company’s long-term is less compared to the previous year
thereby reducing the cash and being unable to operate the business activities effectively at the time.
But decreasing debt is good for the company because it’s bears interest.
Equity
Equity is simply defined that is the owner’s capital. Above the cash flow statement, equity was
climbed by 200 from 2020 to 2021 resulting in a positive effect on the statement of a company.
Because owner’s equity increases in resulting the company can reinvest their money in a new
project. It is undoubtedly said that the company is financially solid in this aspect.
Net cash flow
Finally, after calculating and analysing the cash flow statement, we notice that the net cash flow
was positively changed by 50 from 2020 to 2021. So, it may be stated that the company's sales are
increasing. When sales increase, the company's revenue increases as well, which results in an
increase in cash on hand as well. We may conclude that the company’s financial performance
currently was solid as a whole.
Problem-2
The following Balance Sheet is given:
Assets 2019 2020 2021
Current Assets
Cash 90 135 155
Accounts Receivable 178 115 290
Inventory 301 370 675
Fixed Assets 2731 2880 2880
Total Assets 3300 3500 4000
Liabilities and
Owners’ Equity
Accounts Payable 175 220 180
Notes Payable 355 240 540
Long Term Debt
(Liability)
570 540 780
Owner’s equity 2200 2500 2500
Total 3300 3500 4000
4
Let us prepare Prufrock's common-size balance sheets for the years 2019 to 2021, which are
shown below.
Assets 2019 2020 2021
Current Assets
Cash 3% 4% 4%
Accounts Receivable 5% 3% 7%
Inventory 9% 11% 17%
Fixed Assets 83% 82% 72%
Total Assets 100% 100% 100%
Liabilities and
Owners’ Equity
Accounts Payable 5% 6% 5%
Notes Payable 11% 7% 14%
Long Term Debt
(Liability) 17% 15% 20%
Owner’s equity 67% 71% 63%
Total 100% 100% 100%
Analysing the financial development of the firm.
Amount of current assets in each of the three years 2019-2021: 17 percent, 18 percent, and
28 percent of total assets respectively. By 2020, it will have increased to 18 percent of the
total assets. It corresponds into a 1% rise in total assets between 2019 and 2020. By 2021,
it will have increased to 28 percent of the overall value of the assets. Compared to the
previous year, this represents a 10 percent growth in total assets.
Meanwhile, current liabilities decrease from 16 percent to 13 percent of total assets. It
results into an absolute decrease of 3 percent between 2019 and 2020. However, by 2021,
it will have increased by a total of 19 percent. It translates into a 6% increase in overall
liabilities over the previous fiscal year.
Long-term debt (liability) goes down from 17% to 15%. It means that there will be a total
drop of 2%. In 2021, long-term debt will rise again, which is bad for the company because
the company can't run its business smoothly.
The total amount of equity has increased from 67 percent to 71 percent. It is a positive
development for the organization. The overall equity of the company decreases by 8% in
2021 compared to the previous year.
Let us prepare Prufrock's common-size balance sheets for the years 2019 to 2021, which are
shown below.
Assets 2019 2020 2021
Current Assets
Cash 3% 4% 4%
Accounts Receivable 5% 3% 7%
Inventory 9% 11% 17%
Fixed Assets 83% 82% 72%
Total Assets 100% 100% 100%
Liabilities and
Owners’ Equity
Accounts Payable 5% 6% 5%
Notes Payable 11% 7% 14%
Long Term Debt
(Liability) 17% 15% 20%
Owner’s equity 67% 71% 63%
Total 100% 100% 100%
Analysing the financial development of the firm.
Amount of current assets in each of the three years 2019-2021: 17 percent, 18 percent, and
28 percent of total assets respectively. By 2020, it will have increased to 18 percent of the
total assets. It corresponds into a 1% rise in total assets between 2019 and 2020. By 2021,
it will have increased to 28 percent of the overall value of the assets. Compared to the
previous year, this represents a 10 percent growth in total assets.
Meanwhile, current liabilities decrease from 16 percent to 13 percent of total assets. It
results into an absolute decrease of 3 percent between 2019 and 2020. However, by 2021,
it will have increased by a total of 19 percent. It translates into a 6% increase in overall
liabilities over the previous fiscal year.
Long-term debt (liability) goes down from 17% to 15%. It means that there will be a total
drop of 2%. In 2021, long-term debt will rise again, which is bad for the company because
the company can't run its business smoothly.
The total amount of equity has increased from 67 percent to 71 percent. It is a positive
development for the organization. The overall equity of the company decreases by 8% in
2021 compared to the previous year.
5
Financial health improved from 2019 to 2020, according to the common-size balance sheet.
Current asset aspects will be raised in 2021, which is beneficial to the business. It's detrimental for
the business when the value of fixed assets drop.
For any company that relies on borrowing money from others, a growth in current liabilities in
2021 is a positive move. However, long-term debt is interest-bearing, so increasing long-term debt
is bad for the organization.
The decline in owner's equity in 2021 is detrimental to any organization since it indicates that
profits are being distributed across different sectors of the company.
Problem-3
Following Balance Sheet is given:
Assets 2019 2020 2021
Current Assets
Cash 90 135 155
Accounts Receivable 178 115 290
Inventory 301 370 675
Fixed Assets 2731 2880 2880
Total Assets 3300 3500 4000
Liabilities and
Owners’ Equity
Accounts Payable 175 220 180
Notes Payable 355 240 540
Long Term Debt
(Liability)
570 540 780
Owner’s equity 2200 2500 2500
Total 3300 3500 4000
Financial health improved from 2019 to 2020, according to the common-size balance sheet.
Current asset aspects will be raised in 2021, which is beneficial to the business. It's detrimental for
the business when the value of fixed assets drop.
For any company that relies on borrowing money from others, a growth in current liabilities in
2021 is a positive move. However, long-term debt is interest-bearing, so increasing long-term debt
is bad for the organization.
The decline in owner's equity in 2021 is detrimental to any organization since it indicates that
profits are being distributed across different sectors of the company.
Problem-3
Following Balance Sheet is given:
Assets 2019 2020 2021
Current Assets
Cash 90 135 155
Accounts Receivable 178 115 290
Inventory 301 370 675
Fixed Assets 2731 2880 2880
Total Assets 3300 3500 4000
Liabilities and
Owners’ Equity
Accounts Payable 175 220 180
Notes Payable 355 240 540
Long Term Debt
(Liability)
570 540 780
Owner’s equity 2200 2500 2500
Total 3300 3500 4000
End of preview
Want to access all the pages? Upload your documents or become a member.
Related Documents
Management Accounting: Cash Cycle, Existing System and Capacity Analysislg...
|12
|1621
|318
Financial Accounting: Income Statement, Statement of Financial Position, Assumptions, and Cash Flow Statementlg...
|7
|761
|51
Difference Between Profit and Cash Flow in Business Financelg...
|13
|3260
|27
Cash Flow Statement for Aayush Foods and Herbs Limitedlg...
|7
|955
|251
Management Accounting | Assignment 1lg...
|14
|1740
|26
Business Finance: Meaning, Difference between Profit and Cash Flowslg...
|10
|2733
|75