5038 Asm2 Nguyen Thi Thu Hien Gbd1103

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5038 ASM2 Nguyen Thi Thu Hien GBD1103
Marketing Research (Greenwich Việt Nam)
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ASSIGNMENT 02 FRONT SHEET

Qualification BTEC Level 4 HND Diploma in Business
Unit number and title Unit 5: Accounting Principles
Submission date Date received (1st Submission)
Re-submission date Date received (2nd Submission)
Student Name Nguyen Thi Thu Hien Student ID GBD210182
Class No. GBD1103 Assessor Name Vo Cong Nghia
Student declaration
I certify that the assignment submission is entirely my own work and I fully understand the consequences of plagiarism.
I understand that making a false declaration is a form of malpractice.
Student Signature
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Table of Contents
I. INTRODUCTION ....................................................................................................................vi
1.1 The main purpose of the report........................................................................................ vi 1.2.
Introduction about NET Detergent................................................................................. vi II.
DEFINITION.......................................................................................................................... vii 2.1.
Definition of financial ratio .............................................................................................vii 2.2.
Types of financial ratio.................................................................................................. viii 2.2.1.
Profitability Ratios.................................................................................................. viii 2.2.2.
Liquidity Ratios..........................................................................................................ix 2.2.3.
Solvency ratios.............................................................................................................x 2.2.4.
Efficiency ratios.........................................................................................................xii 2.2.5.
Market prospect ratios............................................................................................ xiii
III. PRODUCING FINANCIAL STATEMENT..................................................................... xiv
IV. IDENTIFY THE RATIOS IN TERMS OF LIQUIDITY AND EFFICIENCY,
SOLVENCY, PROFITABILITY AND MARKET PROSPECTS FOR NET FROM 2021 TO
2022.......................................................................................................................................xix
4.1. Liquidity ratio.................................................................................................................. xix
4.1.1. Current ratio.............................................................................................................xix
4.1.2. Quick ratio................................................................................................................. xx 4.2.
Efficiency........................................................................................................................... xx 4.2.1.
Inventory Turnover ratio ........................................................................................ xxi 4.2.2.
Assets Turnover ratio............................................................................................... xxi 4.3.
Solvency ratios..................................................................................................................22 4.3.1.
Debt-to-equity ratio................................................................................................... 22 4.3.2.
Leverage Ratio.............................................................................................................2 4.4.
Profitability ratios..............................................................................................................3 4.4.1
Gross Profit margin ..................................................................................................... 3 4.4.2. Net
profit margin......................................................................................................... 4 4.4.3. Return
on Assets..........................................................................................................4 4.4.4. Return on
Equity.........................................................................................................5 4.5. Market prospect
.................................................................................................................6 4.5.1. Price-to-earnings
......................................................................................................... 6 4.5.2. Earning
yield................................................................................................................8
V. Preparing budgets .................................................................................................................. 10
5.1. A cash budget for an organization using a spreadsheet ...............................................10
5.2. Benefits and limitations of budgets and budgetary planning, and control for an
organization .............................................................................................................................12
5.2.1. Budgets.......................................................................................................................12
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5.2.2. Budgetary planning and control.............................................................................. 14

VI. IDENTIFY CORRECTIVE ACTIONS TO THE PROBLEM AND JUSTIFY
BUDGETARY CONTROL SOLUTIONS FOR ORGANIZATIONAL DECISION-
MAKING......................................................................................................................................16
VII. CONCLUSION.................................................................................................................... 18
REFERENCES............................................................................ Error! Bookmark not defined.
APPENDIX:.................................................................................................................................23
Picture 1 Net Detergent Joint Stock Company (Net)....................................................................vii

Picture 2 Types of financial ratio (Thakur, 2023)....................................................................... viii
Picture 3 Profitability ratios (Vipond, 2022)..................................................................................ix
Picture 4 Types of solvency ratios (elearnmarkets, 2023).............................................................xi
Picture 5 Types of efficiency ratios (CFI Team, 2022).................................................................xii
Picture 6 Types of market prospect ratios (Bongdap, 2022)....................................................... xiii
Picture 7 Planning and control process.........................................................................................16
Table 1 Unadjusted Trial Balance and Adjusted trial balance..................................................... xiv

Table 2 Income statement and Statement of changes in Owner’s equity of ABC Institute....... xvii
Table 3 Balance sheet of ABC Institute.................................................................................... xviii
Figure 1 Current ratio formula..................................................................................................... xix

Figure 2 Quick ratio formula.........................................................................................................xx
Figure 3 Inventory Turnover ratio formula.................................................................................. xxi
Figure 4 Assets Turnover ratio .................................................................................................... xxii
Figure 5 Debt-to-equity ratio formula.............................................................................................2
Figure 6 Leverage ratio formula......................................................................................................2
Figure 7 Gross Profit margin formula.............................................................................................3
Figure 8 Net profit margin formula.................................................................................................4
Figure 9 Return on assets................................................................................................................5
Figure 10 Return on equity formula................................................................................................6
Figure 11 Price-to-earnings ratio formula.......................................................................................6
Figure 12 Market value per share of NET 2021..............................................................................7
Figure 13 EPS of NET 2021 ...........................................................................................................7
Figure 15 EPS of NET 2022 ...........................................................................................................8
Figure 16 Earning yield formula.....................................................................................................8
Figure 18 EPS of NET 2021 ...........................................................................................................9
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Figure 20 EPS of NET 2022 .........................................................................................................10
Figure 21 Materials Purchases Budget..........................................................................................10
Figure 22 HAC-Materials purchases budget and overhead budget...............................................11
Figure 23 Cash balance .................................................................................................................11
Figure 24 Cost of production ........................................................................................................11
Figure 25 Sales revenue ................................................................................................................11
Figure 26 Cash budget chart for the next year of HAC ................................................................12
Figure 27 Current Assets and Current liabilities of NET 2021 (NET Annual report, 2021)........23
Figure 28 Current assets and current liabilities of NET 2022 (NET Annual report, 2022)..........24
Figure 29 Current assets, liabilities and Inventories of NET 2021...............................................24
Figure 30 Current assets, liabilities and Inventories of NET 2022...............................................24
Figure 31 Cost of goods sold and average inventory of NET 2021..............................................25
Figure 32 Cost of goods sold and average inventory of NET 2022..............................................25
Figure 33 Net revenue and total assets of NET 2021 ....................................................................26
Figure 34 Net revenue and total assets of NET 2022 ....................................................................26
Figure 35 Long-term liabilities and equity of NET 2021 ..............................................................27
Figure 36 Long-term liabilities and equity of NET 2022 ..............................................................28
Figure 37 Total Assets and Sharehoders’ Equity of NET 2021....................................................29
Figure 38 Total Assets and Sharehoders’ Equity of NET 2022....................................................29
Figure 39 Gross profit and net revenue of NET 2021 ...................................................................30
Figure 40 Gross profit and net revenue of NET 2022 ...................................................................30
Figure 41 Net profit and net sales revenue of NET 2021 ..............................................................31
Figure 42 Net profit and net sales revenue of NET 2022 ..............................................................31
Figure 43 Total assets and net profit of NET 2021.......................................................................32
Figure 44 Total assets and net profit of NET 2022.......................................................................32
Figure 45 Shareholders’ equity and net profit of NET 2021.........................................................33
Figure 46 Shareholders’ equity and net profit of NET 2022.........................................................33
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I. INTRODUCTION
1.1 The main purpose of the report
Having completed a six-month probationary period as a Graduate Trainee at PwC, I am currently

engaged in tasks related to delivering accounting and consulting services to businesses. My
primary focus involves identifying customers with high growth potential and scalable business
models. Additionally, I provide essential support and guidance on budgeting, aiming to facilitate
a comprehensive understanding of how budgets inform effective resource allocation, as well as
support efficient control and decision-making processes within businesses. One of my key
responsibilities is the preparation of financial statements and specific financial ratios for Net
Detergent, followed by a comparative analysis with competitors and industry averages.
Moreover, my report delves into the advantages and limitations of budgets, discussing their role
in planning, and control, and their significant impact on organizational decision-making.
1.2. Introduction about NET Detergent
NET Detergent Company is a prominent local Vietnamese home care product sector firm
founded in 1968. Additionally, NET belongs to VINACHEM, the Vietnam Chemical Group. The
company's business lines include Manufacturing hygiene products, soaps, detergents, polishes,
and cosmetics; selling household appliances in bulk; and selling chemicals and cleaning supplies
in bulk. NETCO has two factories: one each in Bien Hoa and Ha Noi. Prominent technical
experts greatly admire both factories. The current design capacities are 90,000 tons of liquid
detergent and 180,000 tons of washing powder. Currently, NETCO is Unilever's strategic partner
for providing premium detergent goods, including VIM floor cleaner, OMO washing powder,
Surf washing powder, and Sunlight dishwashing liquid. Number of products The steady increase
in supply to Unilever over the years is an eloquent demonstration of the enterprise's production
capacity. NETCO's entire laundry detergent and liquid detergent production technology is
consulted and supported by Unilever's technical experts. The foundation of product quality
continues to make NETCO one of the strategic partners of many companies, especially the
multinational corporation Unilever.
Apart from delivering goods to Unilever, NET Washing Powder Joint Stock Company also
distributes a lot of dishwashing liquid and washing powder to export markets in the Americas,
Africa, Australia, New Zealand, Japan, and ASEAN countries. Through its successful entry into
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the Japanese market, which is regarded as challenging due to its exceptionally stringent quality
criteria, the company has proven that its level of technical and technological proficiency satisfies
needs both locally and globally. In the home market, NETCO forges its route to connect with
customers in a genuine manufacturer's manner by consistently upholding "TRUST" through
"QUALITY & PRICE". As a result, a greater percentage of customers consistently accept and
trust NETCO's products over those of other companies (NETCO, 2020).
Picture 1 Net Detergent Joint Stock Company (Net)
(Source: https://www.netcovn.com.vn/Default.aspx)
II. DEFINITION
2.1. Definition of financial ratio

Numerical values from financial statements are used to produce financial ratios, which provide
useful insights into a corporation. Quantitative analysis is performed on a company's balance
sheet, income statement, cash flow statement, and balance sheet numbers to evaluate the
company's liquidity, leverage, growth, margins, profitability, rates of return, and other aspects
(CFI Team, 2022).
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2.2. Types of financial ratio
Picture 2 Types of financial ratio (Thakur, 2023)
2.2.1. Profitability Ratios

Financial indicators known as profitability ratios are employed by analysts and investors to
assess a company's capacity to turn a profit from its revenue, balance sheet assets, operating
expenses, and shareholders' equity over a given time frame. They demonstrate how well a
business makes use of its resources to generate revenue and add value for investors. Most
businesses typically aim for a greater ratio or value because it typically indicates that the
company is operating profitably and creating cash flow. When the ratios are examined about
other companies or to earlier times, they are most helpful (Vipond, 2022).
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Picture 3 Profitability ratios (Vipond, 2022)
Return on assets: As the name implies, return on assets (ROA) displays the proportion of net
earnings to total assets held by the business. In particular, the ROA ratio shows how much profit
a business makes after taxes for each dollar of assets it owns. It also gauges a company's asset
intensity. A corporation is deemed to be more asset-intensive the lowers its profit per dollar of
assets. Large capital expenditures are necessary for highly asset-intensive businesses to buy
machinery and other equipment that will provide revenue. A few examples of sectors that are
usually particularly asset-intensive are railroads, automakers, and telecommunications services.
Software firms and advertising agencies are two instances of businesses with fewer assets
(Vipond, 2022).
Return on equity: The percentage of net income from stockholders' equity, or the rate of return
on the capital that equity investors have invested in the company, is expressed as return on
equity (ROE). Investors and stock analysts pay close attention to the ROE ratio. It's common to
use a company's favorably high ROE ratio as justification for buying stock. Businesses that
exhibit a strong return on equity typically possess greater internal cash generation capabilities,
hence reducing their need for loan funding (Vipond, 2022).
Return on invested capital: ROIC, or return on invested capital, is a metric used to quantify the
return produced by all capital providers, including bondholders and shareholders. Comparable to
the ROE ratio, but with a broader application because it takes bondholder capital returns into
account (Vipond, 2022).
2.2.2. Liquidity Ratios
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A sort of financial statistic called a liquidity ratio is used to assess a company's capacity to settle
its immediate debt. By looking at this indicator, one may ascertain whether a business can pay its
present liabilities using its liquid assets. The fast, cash, and current ratios are the three liquidity
ratios that are most frequently utilized. The quantity of current obligations is put in the
denominator of each liquidity ratio equation, while the amount of liquid assets is put in the
numerator (CFI Team, 2022).
Current ratio: Calculating and interpreting the current ratio is the most straightforward liquidity
ratio. On a company's balance sheet, the current assets and current liabilities line items are easily
readable by anybody. To find the current ratio, divide current assets by current liabilities (CFI
Team, 2022).
Quick ratio: Compared to the current ratio, the quick ratio is a more stringent test of liquidity. In
the sense that current liabilities are the denominator and current assets are the numerator, both
are comparable. The fast ratio, however, only takes a few current assets into account. It takes
into consideration assets that are more liquid, like cash, marketable securities, and accounts
receivable. Because they are less liquid, current assets like inventory and prepayments are
excluded. Therefore, the fast ratio serves as a more accurate gauge of a business's capacity to
meet its immediate obligations (CFI Team, 2022).
2.2.3. Solvency ratios

A solvency ratio is a performance metric that helps us examine a company’s financial health. It
allows us, in particular, to ascertain if the business can eventually pay its debts. Lenders,
possible investors, suppliers, and any other organization looking to do business with a certain
company will find the measure to be very helpful. To assess whether a business is financially
sound, it often compares its profitability to its commitments. Given that it is a measure of
financial strength, a larger or stronger solvency ratio is desirable in this context. Conversely, a
low ratio makes future financial obstacles more apparent (CFI Team, 2022).
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Picture 4 Types of solvency ratios (elearnmarkets, 2023)
Debt-to-Equity (D/E) Ratio: The debt-to-equity ratio, or D/E for short, shows how much debt a
corporation has compared to its equity. Obtain the total amount of its debts before calculating the
ratio. Divide the result by the total equity of the business. This gauges how much a business is
relying on debt (leverage) to finance its operations (CFI Team, 2022).
Debt-to-Capital Ratio: As the name suggests, the debt-to-capital ratio establishes the
percentage of a company's total capital that is borrowed. A company's debt-to-capital ratio of
0.45, for instance, indicates that 45% of its capital is derived from debt. In this scenario, a lower
ratio is ideal since it suggests that the business can finance capital expenditures without heavily
depending on debt (CFI Team, 2022).
Interest Coverage Ratio: The number of times a company's profits may be used to pay interest
on its obligations can be ascertained using the interest coverage ratio. The amount can be
computed by dividing the company's profits by its interest payments, before deducting any taxes
and interest. The more solvent the company, the higher the value. To put it another way, it
indicates that daily operations are making enough money to cover interest payments (CFI Team,
2022).
Financial leverage ratio: Financing investments to increase the firm's asset base and yield
returns on risk capital requires borrowing money, which leads to financial leverage. To raise the
possible return on investment, leverage is the practice of leveraging borrowed funds, more
precisely the employment of different financial instruments or borrowed resources. In addition,
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the amount of debt a company utilizes to finance its assets can be referred to as leverage
(HAYES, 2023).
Fixed charge ratio: The ability of a company to pay for fixed charges, such as debt payments,
interest costs, and equipment lease expenses, is gauged by the fixed-charge coverage ratio, or
FCCR. It demonstrates how well a business's profits can pay for its fixed costs. This ratio is
frequently considered by banks when determining whether to lend money to a company
(HAYES, 2022)
2.2.4. Efficiency ratios
Efficiency ratios are performance indicators that help assess how well a business uses its assets
and capital to generate revenue. In essence, the ratios show what kind of profit or return on
investment a business can get given the amount of money it spends on running its operations.
They do this by comparing the costs incurred and the revenues earned (CFI Team, 2022)
Picture 5 Types of efficiency ratios (CFI Team, 2022)
Inventory Turnover ratio: Inventory turnover ratio is how often a business sells out of goods
within a certain time frame. This ratio is calculated by dividing the average inventory for a
specific period by the cost of goods sold (CFI Team, 2022).
Accounts Receivable Turnover ratio: The effectiveness of revenue collection is assessed by

the accounts receivable ratio. It calculates how frequently an organisation collects its average
amount of accounts receivable in a specific time frame (CFI Team, 2022).
Accounts Payable Turnover ratio: The accounts payable turnover ratio represents the average
number of times a company pays its creditors during an accounting period. Additionally, this
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ratio can be used to evaluate short-term liquidity. Because it allows a business to store money
longer, a larger proportion of payable turnover is beneficial. As a result, the working capital
cycle or funding gap will be reduced (CFI Team, 2022).
Assets Turnover ratio: The asset turnover ratio calculates the revenue or sales value of a
business about its assets. An indication of how effectively a business uses its assets to create
income is the asset turnover ratio (HAYES, 2022).
Day’s Sales Inventory: Days sales in inventory (DSI) is a statistic that indicates how long a
company's current inventory will last. It is also referred to as the average age of inventory ratio.
A low DSI ratio is often the goal of businesses because it suggests they can sell their products
rapidly. On the other hand, an abnormally low DSI ratio may indicate problems with the supply
chain and an incapacity to complete orders (Hand, 2022).
2.2.5. Market prospect ratios
The market prospect ratio is a tool used by investors to evaluate the possible return on an
investment. There are several market prospect ratios, and each has advantages and
disadvantages. Market ratio analysis is commonly used by investors to evaluate various
investments and determine which ones to purchase or sell (Bongdap, 2022).
Picture 6 Types of market prospect ratios (Bongdap, 2022)
Earnings per share: Earnings per share (EPS) represents the total profit generated per
outstanding common share measured over a given period, usually a quarter or a year. This
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is a basic financial index that helps investors evaluate the value of a company's stock
based on that company's earnings when combined with the price-to-earnings ratio
(Semczuk, 2023).
Price-to-earnings ratio: The price-to-earnings ratio (P/E) is one of the most widely used
metrics for investors and analysts to determine stock valuation. It displays the
overvaluation or undervaluation of a company's shares as well as how the valuation of a
stock stacks up against that of its industry or a benchmark such as the S&P 500 index.
Comparing similar companies is important since a good P/E for one group or industry may
be a poor P/E for another (Davis & Taube, 2022).
Earning yield: The earnings yield is calculated by dividing the earnings per share for a
given financial period by the share price as of that moment. That is the P/E ratio's
reciprocal. Investors might learn how much he has earned per share by looking at the
earnings yield. An investor has made Rs. 8 for every Rs. 100 worth of shares they own if a
company has an 8% earnings yield (Athena, 2023).
Dividend payout ratio: The dividend yield is a financial statistic that compares the
amount of cash dividends paid to common shareholders to the share price. Investors use
the dividend yield to show how their stock investments are increasing their asset worth
through stock appreciation or producing cash flows in the form of dividends. The goal of
investing in stocks for investors is to earn a return on their capital through dividends or
stock appreciation. Certain firms would rather pay dividends frequently in order to attract
investors' attention. These securities are also known as income stocks at times. Some
companies choose to reinvest their profits back into the company rather than paying
dividends. These stocks are often known as growth stocks (My Accounting Course, 2017).
III. PRODUCING FINANCIAL STATEMENT
Table 1 Unadjusted Trial Balance and Adjusted trial balance
ABC Institute
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Unadjusted Trial Balance Adjusted Trial Balance
31-Dec 31-Dec
Debit Credit Debit Credit
Cash $34,000 $34,000

Accounts receivable $-$8,000 $3,870
Teaching supplies $12,000 $5,830
Prepaid insurance $3,000 $9,130
Prepaid rent $35,000 $-
Professional library $35,000
Accumulated depreciation, professional
library $80,000 $10,000 $15,320
Equipment $80,000
Accumulated depreciation, equipment $15,000 $24,420
Accounts payable $26,000 $26,000
Salaries payable $- $880
Unearned training fees $12,500 $9,930
ABC, capital $50,000 $90,000 $90,000
ABC, withdrawals $50,000
Tuition fees earned $123,900 $127,770

Training fees earned $- $40,000 $42,570
Depreciation expense, Professional library $- $5,320
Depreciation expense, Equipment $50,000 $9,420
Salaries expense $- $50,440
Insurance expense $33,000 $2,870
Rent expense $-$6,000 $36,000
Teaching supplies expense $6,400 $2,170
Advertising expense $6,000
$317,400
Utilities expense $6,400
Total $317,400 $336,450 $336,450
From the transaction (a) forward, an examination of ABC's insurance policies reveals that
a certain amount of coverage $2,870 in total has expired. This transaction involves the use
of two accounts are insurance spending and prepaid insurance. There's a debit column item
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because insurance expenses are going up. It is still recorded as a credit even if the pre-paid
insurance has decreased in value and is now an asset.
Regarding transaction (b), an inventory check shows that $2,170 worth of teaching
supplies are still available at the end of the year. This transaction involves the teaching
supplies expense and teaching supplies accounts. The cost of instruction has gone up for
consumption purposes, much like a transaction, thus it is recorded as a debit. Since they
have decreased, the teaching supplies are included in the credit column as an asset of ABC
under the terms of the contract.
There is an annual depreciation of $9,420 on the equipment related to transaction (c). This
transaction includes the equipment's total depreciation as well as the equipment's initial
depreciation. Depreciation expenses on equipment are recorded negatively, which reduces
net income. Since equipment's accumulated depreciation shows how fixed assets' value is
decreasing, it is a counter asset account with a credit.
The next transaction (d) is similar to the previous one (c), but it contains $5,320 for the
professional library. The equipment's cumulative depreciation and the professional
library's depreciation expense are included in this transaction and are subsequently divided
into debit and credit columns.
By the end of the year, a client will have finished two out of five courses, as shown in
transaction (e). All five courses were paid for in full up front by the consumer, and ABC
credited the unearned training expenses. The right amount in this example is double that
amount, or 5,140 dollars, as two courses were finished for $2,570 each. Consequently,
there are two accounts involved in this transaction: earned and unearned training fees.
Unearned travel costs are recorded as a debit since they represent a diminishing liability.
The received training costs are recorded as a credit because they are related to the income
account.
The following transaction is (f), where ABC stated that the tuition for a four-month course
brought in $3,870 on December 31. It is crucial to review two accounts in this transaction:
the collected tuition money and the account receivable. The account receivable appears in
the debit column since it is an asset account that is growing. Since the earned tuition fees
are regarded as revenue, they are subsequently recorded as a credit.
In the transaction (g), ABC is paying salaries to two employees who had each accrued two
days' wages at a rate of $440 per day. As a result, the total needed to pay for them is $880.
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Therefore, two accounts associated to this transaction are salaries payable and salaries
expenditure. Since the cost of salaries has grown, a debit has been made for it. Since the
liability account for the salary payable has grown, it is reported as a credit.
The sum in the Prepaid Rent account reflects the $3000 in December rent, therefore the final
transaction (h) includes both the Rent Expense and Prepaid Rent accounts. Similar to the
transaction (g), the rent expenditure has increased, hence it is reported as a debit. The prepaid
rent is a credit value even though it is an asset account and has risen.
Following proper computation, the output data is placed in the appropriate account type and
position in the adjusted trial balance to ensure that the sheet is equal in both the debit and
credit columns.
Table 2 Income statement and Statement of changes in Owner’s equity of ABC Institute
ABC Institute
Income Statement
For Year Ended December 31, 2009
Revenues
Tution fees earned $127,770
Training fees earned $42,570
Total Revenue $170,340
Depreciation expense, Professional library $5,320
Depreciation expense, Equipment $9,420
Salaries expense $50,440
Insurance expense $2,870
Rent expense $36,000
Teaching supplies expense $2,170
Adverting expense $6,000
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Utilities expense $6,400
Total Expense $118,620
Net Income $51,720
ABC Institute
Statement Of Owner's Equity
ABC, capital $90,000
Net Income $51,720
Total $141,720
ABC, Withdrawals $50,000
Total Equity $91,720
The income statement's value is displayed as net income, which is calculated as total
revenues less total costs and equals $51,720. According to the owner's equity statement,
net capital is $91,720, which is determined as capital plus net income minus ABC's
withdrawals.
Table 3 Balance sheet of ABC Institute
ABC Institute
Statement Of Owner's Equity

Assets
Cash $34,000
Account receivable $3,870
Teaching supplies $5,830
Prepaid insurance $9,130
Prepaid rent $-
Professional library $35,000
Accumulated depreciation, Professional library $-15,320
Equipment $80,000
Accumulated depreciation, equipment $-24,420
Total Assets $128,090
Liabilities
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Accounts payable $26,000

Salaries payable $440
Unearned training fees $9,930
Total liabilities $36,370
Owner's Equity
Total equity $91,720
Total Equity and Liabilities $128,090
Following the development of the Adjusted Trial Balance, the information is prepared for
computation to construct the Balance Sheet, which includes the following components:
assets, liabilities, and owner's equity. As a result, Total liabilities + Owner’s equity + Total
assets = $128,090.
IV. IDENTIFY THE RATIOS IN TERMS OF LIQUIDITY AND EFFICIENCY,

SOLVENCY, PROFITABILITY AND MARKET PROSPECTS FOR NET FROM 2021
TO 2022
4.1. Liquidity ratio

4.1.1. Current ratio
Liquidity ratios measure the liquidity of a company. Their usefulness is in revealing how well a
business can use its liquid assets to pay off debts and other responsibilities. All assets with a
quick and inexpensive cash conversion rate are considered liquid. This encompasses not just
cash and account balances but also rapidly convertible securities like shares and short-term
investments like treasury bills. Liquidity might also involve inventories and accounts receivable
in some situations (Asokan, 2022).
Figure 1 Current ratio formula
Current ratio of 2021
. . .
Current Ratio= = 1.17
. . .
Current ratio of 2022
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. . .
Current Ratio = = 1.13
. . .
Net Detergent Company's liquidity ratio is 1.13 in 2022 compared to 1.17 in 2021. This
demonstrates that 2021's liquidity ratio is higher than 2022. As a result, current assets are
employed. used to assess a company's capacity to repay its short-term debt and finance its short-
term debt. The stronger the company's position, the higher this ratio.
4.1.2. Quick ratio
The quick ratio evaluates a company's capacity to sell assets that can be swiftly converted into
cash in order to meet its short-term obligations as they become due. Because it uses rapid assets,
or those that can be converted into cash in less than 90 days, it is also known as the quick
liquidity ratio or the acid test ratio. This comprises marketable securities, cash and cash
equivalents, and current accounts receivable (Kibet, 2022).
Figure 2 Quick ratio formula
Quick ratio of 2021
. . . . . .
Acid test ratio = . . .
= 0.58
Quick ratio of 2022
. . . . . .
Acid test ratio = . . .
= 0.65
A rapid rate of one is considered typical. It shows that the business is well equipped and has
enough assets to immediately pay its obligations and NET has a 2021 current ratio of 0.58 and a
2022 current ratio of 0, 65, which indicates excellent debt service and high liquidity. Evaluation
of a company's ability, excluding inventory, to pay its short-term liabilities with its most liquid
assets. The better the location, the higher the price.
4.2. Efficiency
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4.2.1. Inventory Turnover ratio
Inventory turnover is a financial statistic that demonstrates how frequently a firm sells and
replaces inventory over a specific time frame. The days it takes to sell the company's inventory
on hand may then be determined by multiplying the number of days in the period by the
inventory turnover formula. Calculating the inventory turnover ratio can help businesses make
better decisions on pricing, manufacturing, marketing, and purchasing new inventory. Because
sales contain a markup over cost, analysts divide COGS by average inventory rather than sales to
calculate inventory turnover more accurately (FERNANDO, 2023).
Figure 3 Inventory Turnover ratio formula
Inventory Turnover ratio of 2021
Inventory turnover ratio = . . . . = 5.89

( . . . . . . )/
Inventory Turnover ratio of 2022
. . . .
Inventory turnover ratio = = 6.19
( . . . . . . )/
Considering that NET's inventory turnover appears to be increasing rapidly, increasing from 5.89
in 2019 to 6.19 in 2022, both below one. NET's two-year increase in inventory turnover is
further evidence of the company's strong sales momentum.
The risk that the entire asset base does not generate enough revenue by the end of the year has
led to BCG setting its asset turnover ratio at 127.45 in 2021 and 49.99 in 2021. Quick Gauge
More than one business the company uses revenue to transfer its assets, and all of its coefficients
are less than 1. Although it tends to decrease in 2022, it still holds at a safe level and the
company's operating efficiency remains stable.
4.2.2. Assets Turnover ratio
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A company's sales or revenues are compared to the value of its assets using the asset turnover
ratio. The efficiency with which a business uses its assets to produce income may be determined
by looking at the asset turnover ratio. A corporation is more effective at producing revenue from
its assets the greater the asset turnover ratio. In contrast, a low asset turnover ratio for a
corporation suggests that it is not effectively leveraging its assets to create revenue (HAYES,
2022)
Figure 4 Assets Turnover ratio
Assets Turnover ratio of 2021
. . . .
Assets Turnover ratio = = 2.11
( . . . . . . )/
Assets Turnover ratio of 2022
. . . .
Assets Turnover ratio = = 2.09
( . . . . . . )/
NET's asset turnover is at 2.11 in 2021 and 2.09 in 2021. Measures how quickly a business uses
revenue to turn its assets, and all multiples of it is all greater than 1. Although there is a slight
downward trend in 2022, the company's operating efficiency remains stable and still at a safe
level.
4.3. Solvency ratios
4.3.1. Debt-to-equity ratio
A company's financial leverage is gauged by its debt-to-equity (D/E) ratio, which is calculated
by dividing all of its liabilities by the value of its shareholders. In corporate finance, the D/E
ratio is an important metric. It measures the amount of debt a company is utilising rather than
cash on hand to fund operations. The debt-to-equity ratio is one gearing ratio. The information
needed to compute the D/E ratio can be found on a publicly traded company's balance sheet.
This balance sheet equation is rearranged to provide the value of shareholder equity, which is the
result of subtracting the value of liabilities from the total value of assets shown on the balance
sheet. Investors and analysts regularly adjust the D/E ratio to get a more accurate picture.
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Additionally, they evaluate the D/E ratio considering expected growth, profitability, and short-
term leverage ratios (FERNANDO, 2023)
Figure 5 Debt-to-equity ratio formula
Debt-to-equity ratio of 2021
. .
Debt-to-equity ratio = × 100% = 0,03%
. . .
Debt-to-equity ratio of 2022
. .
Debt-to-equity ratio = × 100% = 0,03%
. . .
NET's debt ratio is extremely low, only 0,03% and 0,03% in 2021 and 2022 when compared to
its equity ratio. This demonstrates that the company frequently uses its own funds to carry out
investment activities to increase production, and most of its debt is short-term. The corporation
has less short-term debt than its suppliers do. This reflects the excellent financial capabilities of
the organization.
4.3.2. Leverage Ratio
A leverage ratio is any of a number of financial metrics that examine the amount of capital that is
in the form of debt (loans) or evaluate a company's capacity to pay its debts. Because businesses
rely on a combination of debt and equity to fund their operations, the leverage ratio category is
crucial because it helps determine a company's ability to repay debt as it becomes due. The list of
common leverage ratios is expanded upon below (HAYES, 2023).
Figure 6 Leverage ratio formula
Leverage Ratio of 2021
. . .
Leverage ratio = = 1.98
. . .
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Leverage Ratio of 2022
. . .
Leverage ratio = = 2.27
. . .
NET, which has a leverage ratio of 1,98 in 2021 and 2,27 in 2022, will primarily rely on its own
cash flow to function. A high asset-to-equity ratio suggests that the business has chosen to
employ careful, low-debt financing.
4.4. Profitability ratios

4.4.1 Gross Profit margin
Analysts can ascertain the financial well-being of a company by projecting the amount of money
remaining from product sales following the deduction of the cost of goods sold (COGS). A
percentage of sales is commonly used to express the gross profit margin, also referred to as the
gross margin ratio. Gross profit margin percentage (gross revenues less allowances, discounts,
and returns) is calculated by subtracting the cost of goods sold (COGS) from net sales. This sum
is then divided by net sales to obtain the gross profit margin expressed as a percentage (Boyd,
2022).
Figure 7 Gross Profit margin formula
Gross Profit margin of 2021
. . .
Gross profit margin = × 100% = 20.14%
. . . .
Gross Profit margin of 2022
. . .
Gross profit margin = × 100% = 17.71%
. . . .
When expenditures and cost of products sold are subtracted from NET profit, the gross profit
margin is 20,14% in 2021 and 17,71% in 2022. Of this total, the company's own product
production accounts for 79,86% in 2021 and 82,29% in 2022; other expenses, net profit, and
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additional fees account for 20,14% in 2021 and 17,71% in 2022. The profit margin of a business
reveals its profitability.
4.4.2. Net profit margin
The net profit margin, sometimes known as the net margin, is the amount of net income or profit
earned as a percentage of revenue. It is the ratio of net profits to revenues for an organization or
business segment. In most cases, net profit margin is stated as a percentage, though it can also be
expressed in decimals. The percentage of revenue that is converted into profit for a business is
shown by its net profit margin. A company's net profit margin is among the most important
indicators of its financial health. An enterprise can assess the efficacy of its current protocols and
project profits by observing fluctuations in its net profit margin, which is derived from sales
figures (MURPHY, 2022).
Figure 8 Net profit margin formula
Net profit margin of 2021
. . .
Net profit margin = × 100% = 7,66%
. . . .
Net profit margin of 2022
. . .
Net profit margin = × 100% = 5.76%
. . . .
With NET's gross profit margin being 7.66% in 2021 and 5.76% in 2022. This is an important
indicator because it shows a business's ability to generate profits from production. or provide
company services. In 2022, gross profit margin decreased compared to 2021, this shows that
NET is facing pressure from competition and must reduce prices to maintain the market, leading
to a decrease in gross profit.
4.4.3. Return on Assets
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Return on assets (ROA), a financial statistic, gauges a company's profitability in proportion to its
total assets. Corporate management, analysts, and investors can evaluate a company's ability to
generate profits by looking at its return on assets (ROA). The metric is commonly expressed as a
percentage utilizing a corporation's net income and average assets. A lower ROA indicates room
for improvement. A greater ROA indicates a company's ability to manage its balance sheet to
earn profits more effectively and efficiently. Divide a company's net income by the total value of
its assets to get ROA. Investors can determine the efficiency of the business in turning its
investments into net income by looking at the ROA statistics. The higher the ROA number, the
better, because the company can earn more money with a smaller investment (McCamish, 2020).
Figure 9 Return on assets
Return on Assets of 2021
. . .
Return on Assets = × 100% = 16%
( . . . . . . )÷
Return on Assets of 2022
Return on Assets = . , , × 100% = 12%

( . . . . . . )÷
The 12% return on assets for NET in 2022 is lower than the 16% return in 2021. Data from 2022
and 2021 shows that in order to make a profit, the company uses and manages a limited amount
of assets.
4.4.4. Return on Equity
A metric of financial performance known as return on equity (ROE) is obtained by dividing net
income by shareholders' equity. ROE is referred to as the return on net assets since shareholders'
equity is determined by subtracting a company's debt from its assets. ROE is regarded as a
barometer of a company's profitability and how well it produces profits. The management of a
firm is more effective at producing income and growth from its equity funding the higher the
ROE. Any corporation may compute its ROE in percentage form if its net income and equity are
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both positive figures. Before dividends given to common shareholders, after payouts to preferred
shareholders, and before interest paid to lenders, net income is computed
Figure 10 Return on equity formula
Return on Equity of 2021
. . .
Return on equity = × 100% = 30%
( . . . . . . )÷
Return on Equity of 2022
. . .
Return on equity = × 100% = 25%
( . . . . . . )÷
NET's 2022 return on equity of 25% is lower than its 2021 return of 30%. Data from 2021 and
2022 shows that businesses are using and managing a stable amount of capital to earn profits and
invest in production and operations.
4.5. Market prospect

4.5.1. Price-to-earnings
The price-to-earnings ratio (EPS) is a ratio used to assess a company by comparing its current
share price to its earnings per share. The price-to-earnings ratio is also known as the price
multiple or earnings multiple. P/E ratios are a tool used by analysts and investors to compare the
relative values of a company's shares on an apples-to-apples basis. Additionally, a company's
prior performance can be compared, as well as the performance of many broad markets
throughout time and against one another. The price-to-earnings ratio (P/E) is a widely used
metric by analysts and investors to determine a stock's relative value. The P/E ratio of a stock
can be used to determine if it is cheap or overvalued. The P/E ratio of a firm may also be
compared to that of other equities in the same sector or the whole market (Berger, 2023).
Figure 11 Price-to-earnings ratio formula
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Price-to-earnings ratio of 2021
Figure 12 Market value per share of NET 2021
(Source: https://s.cafef.vn/hastc/net-cong-ty-co-phan-bot-giat-net.chn)
Figure 13 EPS of NET 2021
(Source: https://finance.vietstock.vn/NET-ctcp-bot-giat-net.htm?tab=BCTN)
.
Price-to-earnings ratio = = 0.01
.
Price-to-earnings ratio of 2022
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.
Price-to-earnings ratio = = 0.01
.
The price-to-earnings ratio is an important way to evaluate economic fluctuations over a given
period of time. By comparing the price-to-earnings ratio from 2021 to 2020, we can see that
earnings show no signs of growth or decline remaining at 0.01%. This can be understood as a
signal that the economy is still in a stable state.
4.5.2. Earning yield
The earnings yield is calculated by dividing the most recent 12-month period's earnings per share
by the share's current market price. The earnings yield, which is the opposite of the P/E ratio,
displays the proportion of earnings per share for a corporation. Investors use earnings yield to
identify assets that appear to be underpriced or overvalued, and many investment managers
utilize it to choose the best asset allocations. Earnings yield is not as frequently employed as the
P/E ratio as a measurement of investment valuation. When there is uncertainty regarding the rate
of return on an investment, earnings yield might be useful. For stock investors, however,
increasing their investment values over time may take precedence over generating regular
investment income (Finance Management, 2022)
Figure 16 Earning yield formula
Earning yield of 2021
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.
Earning yield = × 100% = 103,50%
.
Earning yield of 2022
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.
Earning yield = × 100% = 90,90%
.
In terms of reining in inflation in the economy, the price-to-earnings ratio's decline from
103,50% to 90,90% between 2021 and 2022 is encouraging. This decline can be an indication of
how well economic policy measures working to keep prices stable and safeguard consumer
interests are working.
V. Preparing budgets
5.1. A cash budget for an organization using a spreadsheet
The starting inventory for the next January is the same as the amount of resources on hand in
December (300 units) Therefore, to calculate Budgeted Materials Purchases, we need to
calculate the sum of Production needs and Desired Ending Inventory, then minus for Beginning
Inventory.
Figure 21 Materials Purchases Budget
One unit of raw material costs $5 at HAC, and one unit of raw material is used to create one
completed item. Thus, we calculate. Purchases of Budgeted Materials by Budgeted Materials
Budget purchases of materials multiply with direct materials purchases. From October of this
year, the overhead expenses were $1,300 per month, rising by $57 every three months.
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Figure 22 HAC-Materials purchases budget and overhead budget
The selling price per unit will be $21 for the entire year. Usually, a two-month credit is used for
40% of transactions. After the purchase, the remaining 40% is paid in the month of sale. The final
20% is paid by credit cards to customers. Thus, we may compute the income from cash sales by
multiplying the budgeted sales by 40%, and the revenue from credit card sales by multiplying the
budgeted sales by 20%.
Figure 23 Cash balance
To calculate production cost per unit, we need calculate total of direct materials, direct labour
Cost of production
Figure 24 Cost of production
The sales revenue for the preceding 12 months will be the sum of the budgeted sales. And COGS
will be calculated by multiplying the total number of units sold from January to December by the
unit production cost. Gross profit is the difference between sales revenue and COGS when two
outcomes are achieved. The total of each indication from January to December will represent
selling expense, credit card charge, and marketing expense, in that order. The last stage is to
figure out operating profit, which is equal to gross profit less the total of credit card fees, selling
expenses, and marketing expenses.
Figure 25 Sales revenue
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Figure 26 Cash budget chart for the next year of HAC
Because it depends on both the opening balance and accounts payable, a company's ending cash
balance fluctuates constantly. More precisely, the budget exchange rate increased suddenly
(from 5178.1 USD to 19081.4 USD) between April and June. And by the end of December, the
balance had increased to 19081.4 USD. It is clear that HAC's financial performance is
developing well in the market.
5.2. Benefits and limitations of budgets and budgetary planning, and control for an
organization
5.2.1. Budgets
5.2.1.1. Benefits of budgets
Communication with corporate goals: In modern organizations, some departments handle a lot
of important tasks. It is difficult for the CEO to explain the company's goals to every employee.
However, for an organization to operate at its best, employees in different roles within the
company must understand the corporate objectives. Budget creation is a great way to bridge this
communication gap because it involves both management and front-line staff. In real life, a CEO
would often convene a meeting to review the entire budget of the company and adjust based on
the goals for the upcoming year. Budgeting serves as a communication tool in this way because
it allows for involvement in future planning and discussion of the priorities for where the money
and resources should be spent and dispersed most wisely. More importantly, when managers
forecast future economic conditions and the ability of the organization to adapt to them, they are
compelled to integrate their internal goals and objectives with the external economic
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environment. The entire "communication process" is crucial given the intricacy of business these
days (MBA Knowledge Base, 2018).
Warning of potential problems: Maintaining budgets and regularly comparing them to actual
operational results serves as an early warning system for possible issues, allowing management
personnel to make changes before things spiral out of control and cause the firm to suffer
significantly in terms of money and resources. In this approach, managers in control might alter
their immediate plans in response to a flag being raised, such as changing the product mix,
updating an advertising campaign, or borrowing money to make up for financial deficiencies
(MBA Knowledge Base, 2018)
Coordination of different segments: Setting the budget collaboratively amongst the

departments is essential to resolving conflicts and arguments over how to handle funds and
resources. The chief executive officer often asks other departments to draft their own department
budgets first, considering their particular needs and future objectives. Every department connects
the goals of every step to the broader objectives of the process. Budget preparation presumes that
the various sectors of a corporation must be included, and their operations coordinated. The
budgeting process gives management standards and demonstrates how their operations are
interconnected (MBA Knowledge Base, 2018).
Evaluation of actual performance: The budget lays out precise objectives for evaluating
performance at all levels of authority. Managers in control have the option to execute quick and
easy performance reviews based on predetermined criteria. Because of the rapidly changing
economic landscape, managers may decide to improve operations in a particular sector when
results significantly exceed their expectations. In cases such as these, budgeting significantly
improves objectivity and helps managers make informed decisions by giving them information
to compare. In other cases, operations whose findings indicate a pattern of ongoing inefficiency
would require management to restructure using some sort of measurement. This will enable them
to act swiftly to minimize any possible damages (MBA Knowledge Base, 2018)
5.2.1.2. Limitations of budgets
Overstating projections: Entrepreneurs who have lofty goals often think they can accomplish a
great deal of business in a short amount of time, which is sometimes not very realistic. They
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often employ erroneous sales forecasts in this kind of scenario to boost the projected total sales.
Excessively optimistic projections for future sales will typically lead to an exaggeration of sales
forecasts, so impairing the accuracy of other financial budgets, such as those for cash flow,
income statements, and balance sheets (MBA Knowledge Base, 2018).
Lack of fairness in funds allocation: Different departments sometimes have a propensity to

request more money than they need when asked to create their budgets to provide room for
unforeseeable future events and prevent going over budget. In particular, for corporations that
are at the growing stage when the funds are extremely precious and limited, this tendency
prevents the funds from being allocated to the company's best interest, distorts the real needs,
and makes the next year's funds allocation somehow lack the fairness it should have. What's
worse is that most departments would attempt everything in their power to use up the remaining
budget by the end of the period while squeezing the use of the budget at the beginning of the
period to save for later usage. This inconsistent use wastes even more resources and cash for the
business, which most likely results in inconsistent products and services (MBA Knowledge
Base, 2018).
Lack of operation flexibility: Although adhering to the budgets offers direction for managing
operations, it may inhibit creativity and adaptability in the way the company grows. Because of
how often this happens, the managers carefully and strictly enforce the operation by the budgets,
missing any opportunity that could result in the development of new products and the
investigation of new markets. This is particularly true for huge businesses, where managers are
more likely to stick with the tried and tested than take a risk. As a result, they usually only look
at the annual plan and could overlook the bigger picture (MBA Knowledge Base, 2018).
5.2.2. Budgetary planning and control
5.2.2.1. Benefits of budgetary planning and control
Maximization of profits: The goal of budgetary control is to raise the organization's overall
earnings. This is accomplished by programmatically organizing, coordinating, and managing a
variety of activities (American Express, 2023)
Budgets facilitate planning: Budgets serve as the foundation for precise and definitive
planning since they outline the time and money that each department head is expected to spend.
Budgets are based on specified activities that are modifiable and defensible. As a result,
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objectives are met within the specified parameters, maximizing resource utilization.
Additionally, it encourages delegation because budgets restrict the tasks that managers at all
levels can perform. Lower-level managers can handle regular tasks, freeing up higher-level
managers to focus on strategic thinking (A, 2019).
Budgets facilitate planning: Budgets serve as the foundation for precise and definitive
planning since they outline the time and money that each department head is expected to spend.
Budgets are based on specified activities that are modifiable and defensible. As a result,
objectives are met within the specified parameters, maximizing resource utilization (A, 2019).
Basis for coordination: Making budgets involves managers at all levels, which helps to
coordinate different organizational operations. Department managers across various hierarchical
levels collaborate and synchronize their operations to maximize the use of organizational
resources (A, 2019).
Helps in predicting the future: Budgets are useful for forecasting how future events may
affect a company's operations. Therefore, organizational policies and procedures can
accommodate changes to the environment (A, 2019).
Facilitates delegation of authority: Budgets outline the money to be spent, who gets to spend
it, when, where, and which areas are allotted for the possibility of earning more money.
Financial projections assist senior managers in assigning authority to staff members to complete
budgeted tasks within the parameters specified in the budget (A, 2019).
Facilitates control: Budgets give departments and individuals a way to compare their
performance to benchmarks and monitor any deviations from real performance. To prevent
deviations from happening again, managers can take steps to overcome them and identify the
causes. This gives organizational operations direction under carefully monitored circumstances
(A, 2019).
Financial planning: By estimating the amount of money needed, identifying the sources from
which it will be raised, and outlining strategies, objectives, and policies, budgets aid in the
planning of financial activities. This maximizes the usage of funds and raises the company's
profitability (A, 2019).
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VI. IDENTIFY CORRECTIVE ACTIONS TO THE PROBLEM AND JUSTIFY

BUDGETARY CONTROL SOLUTIONS FOR ORGANIZATIONAL DECISION-
MAKING
According to (Wagh & Gadade, 2013), budgetary control is a management approach that keeps
an eye on staff members and encourages them to complete all financial and academic
assignments in a systematic and organized manner. An organization's planning and control
processes make extensive use of budgeting and budgetary control. Additionally, it helps
administrative authorities conduct a thorough and fair review of all current activities to support
the expansion, abolition, restriction, or diversification of the current practice (Fisher, et al.,
2022). An organization can make decisions with a certain pattern of budgeting and control if it
can identify its objectives, purposes, and goals as well as how these goals are achieved through
the creation of basic policies and plans. Conversely, budgets are management instruments that
provide managers with command over the financial state of their company (Lutkevich, 2022).
Picture 7 Planning and control process
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(Atrill & McLaney, 2021)
After the company's mission and goals have been determined, the many strategic options need to
be considered and examined in order to develop a strategic plan. The company's short-term
financial strategy is outlined in the budget, which is prepared in accordance with the strategic
plan's guidelines. Control can be exerted by comparing actual performance to budgeted
performance. Any significant discrepancy that is found should be addressed in some way. If it
turns out that the estimated amounts are not appropriately based, the budget may need to be
adjusted (Atrill & McLaney, 2021).
Strategically valuable budgets require accurate and thorough data. Choosing a cloud-based,
comprehensive P2P software solution like Planergy gives organisations a significant advantage
in both budget creation and budgetary control. It does this by centralising all spend data,
integrating the current software environment, and standardising information exchange to
eliminate silos, improve communication, and improve the speed and efficiency with which
information is accessed, shared, and analysed. Supplying comprehensive, intelligible, and
transparent spending data to enable speedy, precise evaluation and balance sheet comparison of
planned and actual spending. It is feasible to guarantee adherence to spending rules and assist in
keeping spending within budget by getting rid of rogue expenditure and invoice fraud and
providing customisable review and approval workflows for variations. To do this, make sure
that every expense is recorded, authorised, and allocated to the right department, project, and
stakeholder. Ensure budgetary responsibility Establish a master budget committee with
experienced senior management, including department heads, and designate a budget officer to
act as chair. This committee is responsible for creating budgets, delineating the complete
process of budgeting, and doing variance analysis to evaluate the degree to which the
anticipated amounts and results correspond with the budget. The budget officer is specifically in
charge of communicating the company's budget to all levels and acting as a liaison between the
department heads and the CEO with matters related to budgeting. Establish and implement the
parameters of budgetary control. As it applies budgetary management, the budget committee
creates guidelines and KPIs to ensure participation and adherence. As it may be necessary to
both educate all team members (including top management) on the importance of budgetary
control and compliance and/or overcome some resistance to changes in corporate culture, make
sure the implementation strategy allows for the introduction of budgetary control across the
organization gradually and with an eye toward flexibility. The master budget committee also
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routinely reviews approved budgets to make sure performance and compliance criteria are being
met and to spot any possible deviations so they may be handled proactively rather than
reactively. Budget holders can identify trends through this monitoring that can be used to refine
future spending plans (e.g., altering consumer buying habits during a pandemic), processes that
need to be improved (e.g., increasing efficiency and freeing up funds for other purposes), and
cost centres that need extra care to guarantee minimal waste and a high return on investment.
With the use of data management, budgeting, and analysis tools, budgets will progressively
become more precise and effective, reducing risk, guaranteeing maximum profitability, and
making sure that resources are allocated where they are most needed to support success at the
departmental, business unit, and enterprise levels. Effective budget control administration will
help the organisation, particularly when it comes to making business judgements. Functional
budgets keep costs to a minimum by carefully outlining the spending and performance targets
for a given budgetary period. This reduces risk exposure and provides essential financial
information that organisations may use to improve all aspects of their financial planning and
decision-making process going forward. By providing a comprehensive framework for
administration and monitoring, budgetary control aims to improve communication and
collaboration amongst various departments, as well as transparency and strategic decision-
making. Instead of competing with one another, budget owners can work together with senior
management to effectively utilize resources and advance organizational goals (Murphy, 2021).
VII. CONCLUSION
In conclusion, each of the business's financial metrics is critical to its success. Financial ratios
will appropriately measure each company's situation, representing its stage of decline or growth.
This index allows not only managers but also investors to examine the financial status and
growth prospects of a company. Budgets, budget planning, and budget control also play an
important role in making efficient business decisions for developing organizations.
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20
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34. NET Annual report, 2021. Bao cao tai chinh cho nam ket thuc ngay 31 thang 12 nam
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English: Zenodo .
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APPENDIX:
Figure 27 Current Assets and Current liabilities of NET 2021 (NET Annual report, 2021)
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Figure 28 Current assets and current liabilities of NET 2022 (NET Annual report, 2022)
Figure 29 Current assets, liabilities and Inventories of NET 2021
(NET Annual report, 2021)
Figure 30 Current assets, liabilities and Inventories of NET 2022
24
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Figure 31 Cost of goods sold and average inventory of NET 2021
Figure 32 Cost of goods sold and average inventory of NET 2022
25
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Figure 33 Net revenue and total assets of NET 2021
Figure 34 Net revenue and total assets of NET 2022
26
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Figure 35 Long-term liabilities and equity of NET 2021
27
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Figure 36 Long-term liabilities and equity of NET 2022
28
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Figure 37 Total Assets and Sharehoders’ Equity of NET 2021
Figure 38 Total Assets and Sharehoders’ Equity of NET 2022
29
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Figure 39 Gross profit and net revenue of NET 2021
Figure 40 Gross profit and net revenue of NET 2022
30
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Figure 41 Net profit and net sales revenue of NET 2021
Figure 42 Net profit and net sales revenue of NET 2022
31
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Figure 43 Total assets and net profit of NET 2021
Figure 44 Total assets and net profit of NET 2022
32
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Figure 45 Shareholders’ equity and net profit of NET 2021
Figure 46 Shareholders’ equity and net profit of NET 2022
33

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Marketing Research (Greenwich Việt Nam)

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ASSIGNMENT 02 FRONT SHEET

Unit number and title Unit 5: Accounting Principles

Submission date Date received (1st Submission)

Re-submission date Date received (2nd Submission)

Student Name Nguyen Thi Thu Hien Student ID GBD210182

Class No. GBD1103 Assessor Name Vo Cong Nghia

Downloaded by Nguy?n Thành Long (thanhlong080080@gmail.com)

Summative Feedbacks Resubmission Feedbacks

Grade: Assessor Signature: Date:

Internal Verifier’s Comments:

Signature & Date:

5.2.2. Budgetary planning and control.............................................................................. 14

Picture 1 Net Detergent Joint Stock Company (Net)....................................................................vii

Table 1 Unadjusted Trial Balance and Adjusted trial balance..................................................... xiv

Figure 1 Current ratio formula..................................................................................................... xix

Figure 19 Market value per share of NET 2022..............................................................................9

Having completed a six-month probationary period as a Graduate Trainee at PwC, I am currently

1.2. Introduction about NET Detergent

Picture 1 Net Detergent Joint Stock Company (Net)

2.1. Definition of financial ratio

2.2. Types of financial ratio

Picture 2 Types of financial ratio (Thakur, 2023)

2.2.1. Profitability Ratios

Picture 3 Profitability ratios (Vipond, 2022)

2.2.2. Liquidity Ratios

2.2.3. Solvency ratios

Picture 4 Types of solvency ratios (elearnmarkets, 2023)

2.2.4. Efficiency ratios

Picture 5 Types of efficiency ratios (CFI Team, 2022)

Accounts Receivable Turnover ratio: The effectiveness of revenue collection is assessed by

2.2.5. Market prospect ratios

Picture 6 Types of market prospect ratios (Bongdap, 2022)

III. PRODUCING FINANCIAL STATEMENT

Table 1 Unadjusted Trial Balance and Adjusted trial balance

Unadjusted Trial Balance Adjusted Trial Balance

Debit Credit Debit Credit

Cash $34,000 $34,000

Tuition fees earned $123,900 $127,770

Total $317,400 $336,450 $336,450

Tution fees earned $127,770

Training fees earned $42,570

Total Revenue $170,340

Depreciation expense, Professional library $5,320

Depreciation expense, Equipment $9,420

Salaries expense $50,440

Insurance expense $2,870

Rent expense $36,000

Teaching supplies expense $2,170

Adverting expense $6,000

Utilities expense $6,400

Total Expense $118,620

Net Income $51,720

For Year Ended December 31, 2020

ABC, capital $90,000

Net Income $51,720

ABC, Withdrawals $50,000

Total Equity $91,720

Table 3 Balance sheet of ABC Institute

For Year Ended December 31, 2020