BIZ201 Accounting for Decision Making | My Assignment Tutor

ASSESSMENT 4 BRIEFSubject Code and TitleBIZ201 Accounting for Decision MakingAssessmentScenario Analysis – GroupIndividual/GroupGroup (3 – 4 students)Length2,000 wordsLearning Outcomesa) Explain and evaluate the role and importance of financialinformation in business decision makingb) Apply relevant accounting concepts to simple businessscenariosd) Apply basic costing and budgeting techniques to businessdecision makinge) Apply capital budgeting techniques to capital investmentscenariosSubmissionBy 11:55 pm AEST/AEDT Sunday of Module 6 (Week 11)Weighting40%Total Marks100 BIZ201 Assessment 4 Brief Page 1 of 13 Context:This assessment is aimed at consolidating knowledge from Modules 1-6. By completing thisassessment, you will demonstrate the importance of financial information in businessdecision making. This includes the application of costing and capital budgeting techniques tobusiness decisions.Instructions:1. Submit 2 files; Excel Workbook and Business Report.2. Excel workbook is provided on Blackboard. Download it, perform calculations on it,save it and submit with the Business Report.3. For every task, show all workings through appropriate Excel formulas. Answerswithout corresponding Excel formulas will not be accepted.4. Submit your assessment files using the following naming convention:First Name_Last Name_BIZ201_Assessment4_Workbook.xlsxFirst Name_Last Name_BIZ201_Assessment4_Report.docBIZ201 Assessment 4 Brief Page 2 of 13The Crystal Hotel Pty Ltd has a flat organisational structure as per the chart below. TheGeneral Manager oversees each Departmental Manager directly.You have been offered an internship opportunity in the Sales and Marketing Department.Crystal HotelGeneralManager ExecutiveAssistantManager RoomsDivisionHumanResources Accounting Marketing Sales and and Events Functions &Beverage FoodBIZ201 Assessment 4 Brief Page 3 of 13Business ReportThe owners of the Crystal Hotel are planning to build a Wellness Centre (gym) on the rooftopof the hotel. The Sales and Marketing Manager believes this will attract additional customersto the hotel.As the Crystal Hotel is located within the local business district, the Sales and MarketingManager believes the Wellness Centre should be available, at a fee, to guests not stayingat the hotel. She suggests employing a full time, in-house trainer and a part-time dietician.She believes selling monthly memberships, including training sessions and dietary advice,will attract additional clients who may then promote the hotel to their employers foraccommodation and other business-related services.The Sales & Marketing Manager wants to be well prepared to support the WellnessCentre project and has assigned this task to you as the marketing intern.Please note all data included in this report is inclusive of GST.TASK 1In developing the gym, you have been asked to analyse whether to buy or hire thespecific equipment items. These items are included in Appendix 1, along with costs. Thebudget is $200,000.If the gym equipment is bought, then the life of the equipment is 3 years, after whichreplacement is needed. At the end of its useful life, equipment purchased can be sold fora residual value of 20% of their original cost. If the gym equipment is bought, then thereis also a fixed servicing cost for the equipment, which, in total, is $20,000 for the 3 years,paid in advance to a third-party contractor at the commencement of the agreement.The annual fee for hiring each piece of equipment is in Appendix 1. Hiring fees are paid atthe commencement of each year and rise by 3% p.a. Servicing of the equipment isincluded in the hire fee.REQUIREDThe Sales & Marketing Manager would like you to recommend whether to buy or hire thegym equipment. Assume the cost of money is 5% p.a., make recommendation based onyour financial calculations. You must include advantages and disadvantages of eachoption and justify your choice.TASK 2Sales and Marketing DepartmentBIZ201 Assessment 4 Brief Page 4 of 13The Sales and Marketing Manager would like to explore the possibility of offeringmembership to the Wellness Centre, independent of accommodation. Basic Membershipwould include access to the gym, sauna and pool and it would cost clients $20 a week. FullPackage Membership would also include a one-hour weekly session with the in-housepersonal trainer and a dietician consultation every 3 months. Clients would pay $60 perweek for this type of membership.The Sales & Marketing Manager allocates $10,000 as an initial investment forpromoting the Wellness Centre. The subsequent budget for continuous promotions is$2000 per month. The part-time in-house trainer will cost the hotel $3,000 per monthand the part time dietician will cost $1500 per month. These costs are expected toincrease by 3% each year.Forecasted revenue from membership is $300,000 in Year 1, increasing by 10% eachyear.REQUIREDCalculate the net present value of the external membership project for years 1 to 3.Assume the cost of capital = 5%. When determining the value for after-tax net cash flow,assume a company tax rate of 27.5%.Based on your analysis, would you recommend proceeding with the membership project,in its current structure, based on your financial calculations?TASK 3Promotions are planned for the Crystal Hotel Wellness Centre. There will be an openingluncheon for selected business managers in the local community, whose company haspaid for accommodation in the hotel during the last 18 months. The cost of this luncheonis estimated at 200 attendees x $50/ attendee = $10,000. The aim of the luncheon is togain their support for promoting the Wellness Centre to their own employees.As an intern, you have been asked to select additional promotional activities from the list inappendix 2. Your remaining budget is $2,000 per month for each of the next 12 months.In making a recommendation for ongoing promotional activities, assume the Return on Investment(ROI) for each promotional category is as follows:Return on Investment p.a per $1 spent Parramatta TimesFor every $1 spent, $1.20 revenue is generatedDigital FoyerFor every $1 spent, $2 revenue is generatedBus Shelter PosterFor every $1 spent, $0.80 revenue is generatedPrinted BillboardFor every $1 spent, $1.20 revenue is generatedDigital BillboardFor every $1 spent, $1.10 revenue is generated BIZ201 Assessment 4 Brief Page 5 of 13 FlyerRetail advertisingFor every $1 spent, $0.05 revenue is generatedFor every $1 spent, $0.10 revenue is generated. REQUIREDChoose promotional activities from the list in appendix 2 to create a promotional plan forthe Crystal Hotel Wellness Centre. Justify your choice of activities, based on availablebudget and ROI.TASK 4As your final task as a sales and marketing intern, you have been asked to evaluate afurther promotional plan for 1 month – this time to boost occupancy rates at the CrystalHotel. This will include a promotional accommodation rate offer. The standard room rate(“rack rate”) = $250 per night. The hotel has 100 rooms. Monthly occupancy rates = 30%(without promotion)REQUIREDConsider a promotional room rate = $170 per night for 1 month. Assume variable costper room = $50 per night. Fixed costs = $20,000 for 1 month. Conduct the followingBreak-even analysis:1. The contribution margin for one night’s accommodation per room at the promotional roomrate2. The contribution margin ratio at the promotional room rate.3. The monthly break-even point in number of rooms and revenue to be collected.4. The number of rooms to be occupied at the promotional room rate togenerate net profit before tax = $225,000 for 1 month.5. Comment on CVP analysis based on your calculations.BIZ201 Assessment 4 Brief Page 6 of 13Your business report should include the following sections:Cover Page – Includes assessment title, student name and ID, subject name and code,lecturer’s name, submission date, word count. Be creative while making your cover page.Executive Summary – An executive summary provides a succinct summary of the contentwithin the report. It presents information in such a way that readers are able to understandthe intention and key elements of the report without having to read the entire document. Itis recommended to write 10-20% of your total word limit of the report. This section is notincluded in the word count.Table of Contents – A summary of the sections (headings/sub-headings) and pages numbers.Introduction – The introduction sets the scene and provides context for the aim. It providesbackground to the issues being addressed only. (Approximately 10% of word count)Main Discussion – (Rename the headings/sub-headings to reflect your report). This sectionshould provide information regarding the analysis you undertook addressing the keydeliverables i.e. Tasks 1 – 4.Conclusion – The conclusion restates the aim then provides a brief and concise summary ofthe discussion to demonstrate that the aim of the report has been achieved. No newinformation is to be included in the conclusion. (Approximately 10% of word count)References – It is essential that you use Torrens Academic Writing Guide – APA for citing andreferencing research. Please see more information on referencing herehttp://library.laureate.net.au/research_skills/referencing. Please see the marking rubric atthe end of this document for a guide to how many references you should be including in thisreport. References are not included in the word count.Appendices – This is where you provide supporting material which is unsuitable for inclusionin the body of the report, but still has some value to contribute to the report. Note – if youhave included an Appendices section in your report, you must mention them in the mainbody.FormatBIZ201 Assessment 4 Brief Page 7 of 13Appendix 1 GYM EQUIPMENT REQUIREMENTSTreadmillQuantity required: 20Hire Price for 12 months(per item): $1970Purchase Price(per item): $7000Elliptical TrainerQuantity required: 10Hire Price for 12 months(per item): $1010Purchase Price(per item): $4000Exercise BikeQuantity required: 10Hire Price for 12 months(per item): $904Purchase Price(per item): $3500Rowing MachineQuantity required: 5Hire Price for 12 months(per item): $838Purchase Price(per item): $2800 BIZ201 Assessment 4 Brief Page 8 of 13Appendix 2BIZ201 Assessment 4 Brief Page 9 of 13sBIZ201 Assessment 4 Brief Page 10 of 13Appendix 3 Discount RatesPresent Value of $1 Received in n Periods of TimePeriod1%2%3%4%5%6%7%8%9%10%Period10.99010.98040.97090.96150.95240.94340.93460.92590.91740.9091120.98030.96120.94260.92460.90700.89000.87340.85730.84170.8264230.97060.94230.91510.88900.86380.83960.81630.79380.77220.7513340.96100.92380.88850.85480.82270.79210.76290.73500.70840.6830450.95150.03280.86260.82190.78350.74730.71300.68060.64990.6209560.01610.01760.83750.79030.74620.70500.66630.63020.59630.5645670.93270.00960.81310.75990.71070.66510.62270.58350.54700.5132780.92350.00530.78940.73070.67680.62740.58200.54030.50190.4665890.91430.74770.76640.70260.64460.59190.54390.50020.46040.42419100.90530.84010.74410.67560.61390.55840.50830.46320.42240.385510110.89630.90040.72240.64960.58470.52680.47510.42890.38750.350511120.88740.78850.70140.62460.55680.49700.44400.39710.35550.318612130.87870.77300.68100.60060.53030.46880.41500.36770.32620.289713140.87000.75790.66110.57750.50510.44230.38780.34050.29920.263314150.86130.74300.64190.55530.48100.41730.36240.31520.27450.239415160.85280.72840.62320.53390.45810.39360.33870.29190.25190.217616170.84440.71420.60500.51340.43630.37140.31660.27030.23110.197817180.83600.70020.58740.49360.41550.35030.29590.25020.21200.179918190.82770.68640.57030.47460.39570.33050.27650.23170.19450.163519200.81950.67300.55370.45640.37690.31180.25840.21450.17840.148620210.81140.65980.53750.43880.35890.29420.24150.19870.16370.135121220.80340.64680.52190.42200.34180.27750.22570.18390.15020.122822230.79540.63420.50670.40570.32560.26180.21090.17030.13780.111723240.78760.62170.49190.39010.31010.24700.19710.15770.12640.101524250.77980.60950.47760.37510.29530.23300.18420.14600.11600.092325260.77200.59760.46370.36070.28120.21980.17220.13520.10640.083926270.76440.58590.45020.34680.26780.20740.16090.12520.09760.076327 BIZ201 Assessment 4 Brief Page 11 of 13Learning Rubric: Assessment 4 AssessmentAttributesFail(Yet to achieveminimum standard)0 – 49%Pass(Functional)50 – 64%Credit(Proficient)65 – 74%Distinction(Advanced)75 – 84%High Distinction(Exceptional)85 – 100%Grade Description(Grading Scheme)Fail grade will be awardedif a student is unable todemonstrate satisfactoryacademic performance inthe subject or has failed tocomplete requiredassessment points inaccordance with thesubject’s requiredassessment points.Pass is awarded for workshowing a satisfactoryachievement of all learningoutcomes and an adequateunderstanding of theoryand application of skills. Aconsistent academicreferencing system is usedand sources areappropriatelyacknowledged.Credit is awarded for workshowing a more thansatisfactory achievement ofall learning outcomes and amore than adequateunderstanding of theory andapplication of skills. Aconsistent academicreferencing system is usedand sources are appropriatelyacknowledged.Distinction is awarded forwork of superior quality inachieving all learningoutcomes and a superiorintegration andunderstanding of theoryand application of skills.Evidence of in-depthresearch, reading, analysisand evaluation isdemonstrated. A consistentacademic referencingsystem is used and sourcesare appropriatelyacknowledged.High Distinction is awardedfor work of outstandingquality in achieving alllearning outcomes togetherwith outstandingintegration andunderstanding of theoryand application of skills.Evidence ofin‐depth research, reading,analysis, original andcreative thought isdemonstrated. A consistentacademic referencingsystem is used and sourcesare appropriatelyacknowledged.Understanding of buyor hire decisions inbusinessStudents have notunderstood theconcepts of buy or hiredecisions and thewritten answersprovided areunsatisfactory. Some orall Excel formulas weremissing. Majority ofvalues were incorrectand wrong conclusionshave been reached.Students havedemonstrated limitedknowledge of concepts ofbuy or hire decisions.Mistakes in Excelformulas were presentand some formulas weremissing. Due to themistakes, potentiallywrong conclusions havebeen reached.Students demonstratedsome knowledge ofconcepts of buy or hiredecisions in this question.Correct conclusion wasmade, however fewmistakes occurred in thecalculation process.Students demonstratedgood knowledge ofconcepts of buy or hiredecisions, Excel formulaswere provided, correctrecommendations werereached and explanationhas been provided. Minormistakes in calculationsoccurred but have notExcellent knowledge andpractical application ofconcepts of buy or hiredecisions in this task.Students applied the timevalue of money correctly,provided all formulas inExcel. The recommendationregarding buy vs. rentoption has been correct BIZ201 Assessment 4 Brief Page 12 of 13 22%resulted in a wrongdecision.and included detailedexplanation supportedby the analysis.Understanding ofdifferent capitalinvestment options fordecision-making22%Students have notunderstood the twocapital investmentoptions and the writtenanswers provided areunsatisfactory. Some orall Excel formulas weremissing. Majority ofvalues were incorrectand wrong conclusionshave been reached.Students demonstratedlimited understanding ofconcepts of capitalinvestment options.Mistakes in Excelformulas were presentand some formulas weremissing. Due to themistakes, potentiallywrong conclusions havebeen reached.Students demonstrated someunderstanding of concepts ofcapital investment optionscovered in this question.Correct conclusion wasmade, however fewmistakes occurred in thecalculation process.Students demonstratedgood understanding ofconcepts of capitalinvestment options, Excelformulas were provided,correct recommendationswere reached andexplanation has beenprovided. Minor mistakesin calculations occurredbut have not resulted in awrong decision.Excellent knowledge andpractical application ofconcepts of capitalinvestment optionscovered in this task.Students applied thetime value of moneycorrectly, provided allformulas in Excel. Therecommendationregarding the project iscorrect has beensupported by facts andexplained in detail.Development ofactivities for businesswith a budget provided22%Minority of thepromotional items orsuppliers were suited tothe task given. Excelformulas were missing.The template has notbeen used properly, thenumbers are not addingup. Students went overbudget.Some promotional itemsand suppliers were notsuited to the task given.Excel formulas weremissing, but overalltemplate has been usedcorrectly. Many mistakesin calculations have beenpresent; however,students were still withinthe budget given tothem.Majority of the promotionalitems and event supplierswere suited to the task given.Excel formulas have beenprovided with minormistakes. Students were inline with the financialconstrains given to them.Majority of the promotionalitems or event supplierswere well suited to the taskgiven. Excel formulas havebeen provided with minormistakes in calculations.Students were in line withthe financial constrainsgiven to them.Students have chosenappropriate promotionalactivities or eventsuppliers. Correctquantities were appliedand appropriate costingor budget provided.Students were in linewith the financialconstrains given to them.All required referenceshave been provided. AllExcel formulas have beenprovided with nomistakes in calculations. BIZ201 Assessment 4 Brief Page 13 of 13 Cost-Volume-ProfitAnalysis22%The importance andapplication of CVP analysisto scenario is missing.Excel formulas aremissing. The template hasnot been used properly,the numbers are notadding up.Importance of CVP andapplication to scenario isnot suited. Excel formulasare missing, but overalltemplate has been usedcorrectly. Many mistakes incalculations are present.Students have performedmajority of the requiredcalculations. Satisfactory CVPanalysis and application tothe scenario is performed.Excel formulas have beenprovided with minormistakes.Students have performedmajority of the requiredcalculations. Correctformulas are applied.Students are mostly awareof the importance of CVPanalysis and are able toapply it to scenario. Excelformulas have beenprovided with minormistakes in calculations.Students have performedall the requiredcalculations. Correctformulas are applied.Students are well awareof the importance of CVPanalysis and are able toapply it to scenario. Allrequired references havebeen provided. All Excelformulas have beenprovided with nomistakes in calculations.Correct citation of keyresources and evidenceOverall structure,appearance andreferencing of thereport are assessed12%Demonstrates inconsistentuse of good quality,credible and relevantresources to support anddevelop ideas. Less than 4good quality referencesprovided. Has not correctlyused APA referencingstyle.Demonstrates use ofcredible and relevantresources to support anddevelop ideas, but these arenot always explicit or welldeveloped. At least 4 goodquality references provided.Multiple mistakes anderrors in reference list.Demonstrates use of highquality, credible and relevantresources to support anddevelop ideas. At least 6 goodquality references provided.Some mistakes and errors inreference list.Demonstrates use ofgood quality, credible andrelevant resources tosupport and developarguments andstatements. Showsevidence of wide scopewithin the organisationfor sourcing evidence. Atleast 6 good qualityreferences provided. Fewmistakes and errors inreference list.Demonstrates use ofhigh- quality, credible andrelevant resources tosupport and developarguments and positionstatements. Showsevidence of wide scopewithin and without theorganisation for sourcingevidence. At more than 6good quality referencesprovided. No mistakesand errors in referencelist.

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