Assignment 1.

3 Xenakis

Topic: Statement of financial position

Level of difficulty: Low

Xenakis, a young Greek person, arrives on the first day of summer in Byblos, a
Phoenician port city. His parents, respectable rich merchants in Athens, have sent him on
a ‘world’ journey to discover himself and learn about business. They have given him
some material goods and a little money. Xenakis brought these goods and some of the
cash to a venture he set up for the purpose of trading. This business venture is called
Venture Xenakis.

When he arrives in Byblos for a planned ten-day stay, Venture Xenakis' wealth is as
follows:

* six gold flatware pieces, worth 50 drachmas each on the Athens market
* ten crystal glassware pieces, worth 15 drachmas each on the Athens market
* 112 drachmas in cash (down from the 160 drachmas he left home with – his sea
passage had cost him 48 drachmas).

As soon as he sets foot on land, he rents a room at the Cedar Inn. The innkeeper offers
full room and board for ten days for one drachma a day. Once settled in, Xenakis goes
out looking for the Phoenician merchants his parents have recommended to him. As he
ambles along the narrow streets and sunny piazzas, he reminisces about the basic rule his
tutor had taught him: ‘keep a detailed account of all operations and transactions you
engage in’.

Xenakis met a tableware merchant who agreed to buy all of Xenakis' six pieces of golden
flatware for 70 drachmas each. Next, Xenakis sold his crystal pieces for 25 drachmas each
to a glass merchant. He bought, for 45 drachmas each, a dozen amphorae of assorted
spices. He also bought two pieces of silk fabric for 90 drachmas each. Very happy with
his transactions, he then bought, for 50 drachmas in cash, his return fare to Piraeus (the
port of Athens). As soon as he was back in Athens he sold, at the locally accepted prices,
all the merchandise he had brought back:

* 60 drachmas per amphora of spices,

* 120 drachmas per silk piece.

Required

1 Describe Venture Xenakis' ‘net worth’ on the day of his departure from Athens for
Byblos before procuring his sea passage.

2 How much cash does the Venture Xenakis have after he sold all his merchandise after
his return to Athens?

3 Compute the income generated by the Venture Xenakis on his round trip.

4 Describe the Venture Xenakis' ‘net worth’ after his return to Athens.