Adom Ltd, is a private company in Ghana operating in the manufacturing sec Below is a Statement of financial position and a summarized statement of income with comparatives for the year ended 31stDecember 2019. Statement of Financial Position as at 31 December 2019: Non-Current Assets 2019 2018 GH¢ GH¢ Property, Plant & Equipment 200,000 250,000 Research & Development 40,000 - 240,000 250,000 Current Assets Available For Sale Investments 12,000 20,000 Inventory 70,000 45,000 Trade Receivables 30,000 23,000 Cash and Cash equivalents 18,000 17,000 130,000 105,000 370,000 355,000 Equity Equity Share Capital(GH¢1 per Share) 150,000 100,000 10%PreferenceShareCapital 50,000 50,000 Retained Earnings 60,000 55,000 260,000 205,000 Non-Current Liabilities 10% Loan Note 50,000 90,000 12% Debenture 5,000 3,000 55,000 93,000 Current Liabilities Trade &Other Payables 30,000 20,000 Bank Overdraft 25,000 37,000 55,000 57,000 370,000 355,000 Statement of Financial Position as at 31st December2019 2019 2018 GH¢ GH¢ Sales 365,000 219,000 Cost of Sales (219,000) (156,000) Gross profit 146,000 63,000 Operating expenses (55,000) (4,000) Operating profit 91,000 59,000 Income Tax Expense (17,000) (8,000) Finance Cost (9,000) (6,000) Profit for the period 65,000 45,000 Additional Information Industry Ratios Current Ratio: 2.0 times Acid test ratio: 1.0 time Debt to Equity Ratio: 50% Gross Profit Margin: 32% Net Profit Margin: 20% Return on Capital Employed: 22% Required: Prepare a report and address it to the Chief Executive Officer, analysing the financial performance and financial position of Adom Ltd based on the industry ratios above for the years 2018 and 2019.
Critical Path Method
The critical path is the longest succession of tasks that has to be successfully completed to conclude a project entirely. The tasks involved in the sequence are called critical activities, as any task getting delayed will result in the whole project getting delayed. To determine the time duration of a project, the critical path has to be identified. The critical path method or CPM is used by project managers to evaluate the least amount of time required to finish each task with the least amount of delay.
Cost Analysis
The entire idea of cost of production or definition of production cost is applied corresponding or we can say that it is related to investment or money cost. Money cost or investment refers to any money expenditure which the firm or supplier or producer undertakes in purchasing or hiring factor of production or factor services.
Inventory Management
Inventory management is the process or system of handling all the goods that an organization owns. In simpler terms, inventory management deals with how a company orders, stores, and uses its goods.
Project Management
Project Management is all about management and optimum utilization of the resources in the best possible manner to develop the software as per the requirement of the client. Here the Project refers to the development of software to meet the end objective of the client by providing the required product or service within a specified Period of time and ensuring high quality. This can be done by managing all the available resources. In short, it can be defined as an application of knowledge, skills, tools, and techniques to meet the objective of the Project. It is the duty of a Project Manager to achieve the objective of the Project as per the specifications given by the client.
Assignment 1
- Adom Ltd, is a private company in Ghana operating in the manufacturing sec Below is a
Statement of financial position and a summarized statement of income with comparatives for the year ended 31stDecember 2019.
|
Statement of Financial Position as at 31 December 2019: Non-Current Assets |
2019 2018 GH¢ GH¢ |
|
|
Property, Plant & Equipment |
200,000 |
250,000 |
|
Research & Development |
40,000 |
- |
|
|
240,000 |
250,000 |
|
Current Assets Available For Sale Investments |
12,000 |
20,000 |
|
Inventory |
70,000 |
45,000 |
|
Trade Receivables |
30,000 |
23,000 |
|
Cash and Cash equivalents |
18,000 |
17,000 |
|
|
130,000 |
105,000 |
|
|
370,000 |
355,000 |
|
Equity |
|
|
|
Equity Share Capital(GH¢1 per Share) |
150,000 |
100,000 |
|
10%PreferenceShareCapital |
50,000 |
50,000 |
|
|
60,000 |
55,000 |
|
|
260,000 |
205,000 |
|
Non-Current Liabilities 10% Loan Note |
50,000 |
90,000 |
|
12% Debenture |
5,000 |
3,000 |
|
|
55,000 |
93,000 |
|
Current Liabilities Trade &Other Payables |
30,000 |
20,000 |
|
Bank Overdraft |
25,000 |
37,000 |
|
|
55,000 |
57,000 |
|
|
370,000 |
355,000 |
Statement of Financial Position as at 31st December2019
2019 2018
GH¢ GH¢
Sales 365,000 219,000
Cost of Sales (219,000) (156,000)
Gross profit 146,000 63,000
Operating expenses (55,000) (4,000)
Operating profit 91,000 59,000
Income Tax Expense (17,000) (8,000)
Finance Cost (9,000) (6,000)
Profit for the period 65,000 45,000
Additional Information
Industry Ratios
Current Ratio: 2.0 times
Acid test ratio: 1.0 time
Debt to Equity Ratio: 50%
Gross Profit Margin: 32%
Net Profit Margin: 20%
Return on Capital Employed: 22%
Required:
Prepare a report and address it to the Chief Executive Officer, analysing the financial performance and financial position of Adom Ltd based on the industry ratios above for the years 2018 and 2019.
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