BusinessSimulationReportTemplate(1)

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ASSIGNMENT COVER SHEET (Individual) SCHOOL OF ACCOUNTING Surname Given Names Student ID No Student details: IACONI JEROME (Please print clearly) _ 20772208 Unit Name: Financial decision making Assignment Number and/or Name: Business Simulation Report __ _ Due Date: 29 Novemeber 2021 __ Date submitted: Plagiarism Plagiarism occurs when the work of another person, or persons, is used and presented as one’s own, unless the source of each quotation or piece of borrowed material is acknowledged with an appropriate citation. Encouraging or assisting to commit plagiarism is a form of improper collusion and may attract the same penalties. The University regards very seriously any acts of cheating, or dishonesty by way of plagiarism. There is a range of penalties which may be imposed on a student for academic dishonesty, ie plagiarism. Contract Cheating Contract Cheating occurs when the written work or creative work has been drafted or produced by someone else - including classmates, friends, family, paid contracting services and study help websites - and claiming authorship for it.  You are at risk of contract cheating if, among other things, you ask someone to  Complete an assignment (or part of an assignment) for you  Substantially edit your assignment  Do your university work, with or without compensation  Check test or quiz answers  Sit a test or quiz for you  Provide someone with your login details Failure to comply with these instructions may result in a reduced mark/or an academic misconduct investigation. All assignments submitted via Turnitin and a Similarity Report will be generated.

ACCT1002 Financial Decision Making – Template for Assessment 3 Submission Declaration: Except where indicated, the work contained in this assignment is my own work and has not been submitted for assessment in another unit or course. Signature of Student (please type FULL NAME): Jerome Iaconi Introduction Net Profit Margin Ratio 2019 Ratio: -0.0328 2020 COVID Ratio: -0.1241 Discussion/Analysis As calculated from the financial reports, the 2019 net profit margin was -0.0328 (-67,383.69/2,055,025.55) and the 2020 net profit margin was calculated as -0.1241 (-166,662.80/1,343,216.41). The net profit margin was calculated by dividing net profit from net sales which is present on each year’s respective income statements. This demonstrates a further decrease of 278%. This movement can be explained by significant declines in both the Net Profit (from $-67,383.69 in 2019 to $-166,662.80 in 2020) and decline in Net Sales (from $2,055,025.55 in 2019 to $1,343,216.41 in 2020). Jezza’s Pizza’s net profit fell into greater loss as total expenses further increased beyond gross profit levels. This decline has been caused by a reduction in sales volume due to COVID-19 shutdowns which resulted in a cancellation of dine-ins and a move to take- away only. Gross Profit Margin Ratio 2019 Ratio: 0.4975 2020 COVID Ratio: 0.4193 Discussion/Analysis The 2019 gross profit margin was 0.4975 (1,022,377.15/2,055,025.55) and the 2020 net profit margin was calculated as 0.4193 (563,264/1,343,216.41). The gross profit margin was calculated by dividing gross profit from net sales which is present on each year’s respective income statements. This demonstrates a decrease in the gross profit margin from 2019 to 2020 by 15.71%. This movement can be explained by significant declines in both the gross Profit (from $1,022,377.15 in 2019 to $563,264 in 2020) and decline in net sales (from $2,055,025.55 in 2019 to $1,343,216.41 in 2020). That is a reduction of 44.9% in gross profit and a 34.6% decrease in net sales, therefore leading to an overall reduced gross profit margin ratio. Jezza’s Pizza’s gross profit fell to a significant decline in gross sales revenue (from $2,062,528.55 in 2019 to $1,348,272.41 in 2020) due to many months of lockdown in response to the pandemic causing a major fall in sales.

ACCT1002 Financial Decision Making – Template for Assessment 3 Submission Return on Assets Ratio 2019 Ratio: -0.1145 2020 COVID Ratio: -0.4119 Discussion/Analysis The 2019 Return on Asset ratio was -0.1145 (-67,383.69/588,279.55) and the 2020 Return on Asset Ratio was calculated as -0.4119 (-166,662.80/404,579.99). The return on assets ratio was calculated by dividing net profit from total assets which is present on each year’s respective income statements and balance sheets. This demonstrates a decrease in the return on assets ratio from 2019 to 2020 by 259.74%. This movement can be explained by significant declines in both the Net Profit (from $-67,383.69 in 2019 to $-166,662.80 in 2020) and a decline in total assets (from $588,279.55 in 2019 to $404,579.99 in 2020). That is a reduction of 147.3% in net profit and a 31.2% decrease in total assets, therefore leading to an overall reduced Return on Assets Ratio. Jezza’s Pizza’s s total current assets dropped 39.57% (430,500.39-260,150.83/430,500.39) and due to greater amounts of accumulated depreciation in 2020 on equipment, total non-current assets were reduced from $157,779.16 to $144,429.16, a 8.46% decrease. As a result of the pandemic, lockdowns caused havoc for the business, reducing total assets and increasing liabilities overall. Return on Equity Ratio 2019 Ratio: -0.8156 2020 COVID Ratio: 1.9830 Discussion/Analysis Total Asset Turnover Ratio 2019 Ratio: 3.4933 2020 COVID Ratio: 3.3200 Discussion/Analysis

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ACCT1002 Financial Decision Making – Template for Assessment 3 Submission Current Ratio 2019 Ratio: 5.9216 2020 COVID Ratio: 3.5784 Discussion/Analysis Working Capital 2019 Ratio: 357800.3900 2020 COVID Ratio: 187450.8300 Discussion/Analysis Cash Ratio 2019 Ratio: 4.4580 2020 COVID Ratio: 2.6593 Discussion/Analysis

ACCT1002 Financial Decision Making – Template for Assessment 3 Submission Acid Test Ratio 2019 Ratio: 5.5156 2020 COVID Ratio: 3.2542 Discussion/Analysis Accounts Receivable Turnover Ratio 2019 Ratio: 12.0000 2020 COVID Ratio: 12.0000 Discussion/Analysis Inventory Turnover Ratio 2019 Ratio: 45.9689 2020 COVID Ratio: 49.5098 Discussion/Analysis

ACCT1002 Financial Decision Making – Template for Assessment 3 Submission Debt Ratio 2019 Ratio: 0.8596 2020 COVID Ratio: 1.2077 Discussion/Analysis Debt to Equity Ratio 2019 Ratio: 6.1206 2020 COVID Ratio: -5.8138 Discussion/Analysis Equity Ratio 2019 Ratio: 0.1404 2020 COVID Ratio: -0.2077 Discussion/Analysis

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ACCT1002 Financial Decision Making – Template for Assessment 3 Submission Times Interest Earned Ratio 2019 Ratio: -1.1392 2020 COVID Ratio: -4.2909 Discussion/Analysis Conclusion and Recommendation

ACCT1002 Financial Decision Making – Template for Assessment 3 Submission