Accounting and Finance: Murray Ltd Analysis and Project Evaluation

This report provides a comprehensive analysis of accounting and finance principles. It begins with a detailed financial analysis of Murray Ltd, calculating key metrics such as contribution margin, break-even points, and margin of safety, providing insights into the company's profitability and operational efficiency. The report then evaluates two potential marketing projects using net present value and payback period methods, offering recommendations based on the company's cost of capital and payback requirements. Furthermore, the report delves into the importance of working capital management, explaining its impact on a company's financial health, liquidity, and operational success, with a focus on reasons like meeting short-term obligations, and increasing business value. Finally, the report discusses the concept of incremental budgeting, outlining its advantages and disadvantages, and its suitability for different types of companies. This report is a valuable resource for students seeking to understand financial analysis, project evaluation, and working capital management.