Professional Documents
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MWALE
Surname
YAHYA
First Name/s
157876
Student Number
ACCOUTING AND FINANCE
Subject
1
Assignment Number
-
Tutor’s Name
Examination Venue
PIETERMARITZBURG-ASCOTT INN CONFERENCE CENTRE
Date Submitted
Submission (√) First Submission Resubmission
P0 BOX 1157
ESTCOURT
Postal Address
KWA ZULU NATAL
3310
Yahyamwale0301@gmail.com
E-Mail
(Work) 063 288 2440
(Home) 036 352 5537
Contact Numbers
(Cell) 063 288 2440
Declaration: I hereby declare that the assignment submitted is an original piece of work produced by myself.
1
TABLES CONTENT
Question One……………………….3-4
Question Two………………………5-6
Question Three……………………..7-9
2
QUESTION 1
𝐶𝑢𝑟𝑟𝑒𝑛𝑡 𝑎𝑠𝑠𝑒𝑠𝑡𝑠−𝐼𝑛𝑣𝑒𝑛𝑡𝑜𝑟𝑦
1.1) Acid-test ratio =
𝐶𝑢𝑟𝑟𝑒𝑛𝑡 𝑙𝑖𝑎𝑏𝑖𝑙𝑖𝑡𝑖𝑒𝑠
860.000−180000
=
1200000
= 5,7: 1
𝐴𝑐𝑐𝑜𝑢𝑛𝑡𝑠 𝑟𝑒𝑐𝑒𝑖𝑣𝑎𝑏𝑙𝑒
1.2) Debtors collection period= × 365
𝐶𝑟𝑒𝑑𝑖𝑡 𝑠𝑎𝑙𝑒𝑠
330000
= × 365
10500000
= 11.5
480000 100
= ×
1520000 1
= 315.9
3
𝑃𝑟𝑜𝑓𝑖𝑡 𝑎𝑓𝑡𝑒𝑟 𝑡𝑎𝑥 100
1.4) Profit margin = ×
𝑠𝑎𝑙𝑒𝑠 1
2695000 100
= ×
10500000 1
= 25.7
2695000 100
= ×
900000 1
= 299.44
4
QUESTION 2
2.1)
Month
January(Jan 21000 4116 - -
𝑹 𝟐𝟏𝟎𝟎𝟎 ×
𝟐𝟎% × 𝟗𝟖%)
(FEB)
R 21000×50% -
10500
March(𝟐𝟒𝟎𝟎𝟎𝟎 ×
𝟓𝟎%)
-
- 120000
March(𝟑𝟎𝟎𝟎𝟎𝟎 × 300000 - - 58800
𝟐𝟎% × 𝟗𝟖%
4116 57540 178800
5
2.2)
Tulane Traders
Cash budget for the period 01 Jan to 31 March 2020
6
QUESTION 3
117000 100
= ×
200000 1
= 60%
109000+100000+124000+132000+120000
NOTE: Average Annual profit =
5
= 117000
7
3.2)
R
INVESTMENT (400000)
Year 1 109000
(291000)
Year 2 100000
(191000)
Year 3 124000
(67000)
Year 4 132000
3 years 6 months 2-3days
67000
× 12
132000
= 6.090909091
= 6 𝑚𝑜𝑛𝑡ℎ𝑠
3.3) No, It will not be accepted since the payback period is 3 years
8
3.4)
Year Cash Inflow Discount Present value
Factor
1 109000 0.9009 R98198
2 100000 0.8116 R81160
3 124000 0.7312 R90668.8/90670
4 132000 0.6587 R86948
5 120000 0.5935 R71220
Total PV R428194.8/428196
Investment (R400000)
R428194.8/428196-
R400000
NPV R28194.8/28196
(Positive)
3.5) Yes, NPV is positive, the project maybe accepted on financial grounds. The higher the
NPV the more acceptable the project is.