Answer To: [ Business Analysis and Results Interpretation ] [ 2 of 3 ] [ 15/11/2019 ] Student product...
Neha answered on Oct 23 2021
Instructions
C-COR Digital Import Pty Ltd
Financial performance for the year ending 2020 and 2019
As a business advisor you have been assigned the task to conduct an analytical review of the company’s performance (Profit and loss statement) for the year ending 2020 and 2019
in line with the company’s master plan to expand its operation to Europe.
C-COR Management asked you to include in your analytical review the following:
1. Compare and investigate 2020 and 2019 Profit and Loss Statement balances for movement greater than 15% and provide a brief and meaningful explanation for any correlation noted.
2. Using Profitability ratios outline whether the company profitability is sustainable in the near future.
3. What short term strategy the company should adopt to increase the net profit by 30%
4. Advise whether the current company business structure is the most efficient and most suitable to this sort of enterprise.
5. Advise on the current format of the Profit and loss Statement and whether it is in line with Australian reporting and statutory requirements
&"Calibri"&12&KEEDC00RMIT Classification: Trusted&1#
Q1
C-COR Digital Import Pty Ltd
Financial performance for the year ending 2020 and 2019
2020 2019 Movement % of sales (2020)
SALES
Sales income 9,800,400 5,402,944 4,397,456 44.87% The sales have increased due to which income has sheen increment.
COST OF SALES
Purchases 3,549,652 1,030,905 2,518,747 70.96% For more sales and to support demand more purchases r material was done .
Total Cost of Sales 3,549,652 1,030,905 2,518,747 70.96% The increase in sales have increased the cost of sales and the expenses of manufacturing has increased.
GROSS PROFIT 6,250,748 4,372,039 1,878,709 30.06% There is an irese in gross profit due to increase in ssale
EXPENSE
Accounting fees 64,610 23,898 40,712 63.01% The increase in accounting as shows any kind of default in at compliance or need of more accounting resources such as an automated system.
Audit fees 15,780 38,510 -22,730 -144.04% This is voidable risk.
Bank charges 42,170 23,231 18,939 44.91% The increase in bank charges shows any default done by the company
Business Application Services 24,804 28,512 -3,708 -14.95% A new apps in bought for better accoutning
Commission paid 178,514 109,060 69,454 38.91% More commission were paid due to increase in sale
Consultancy fees 159,970 110,719 49,251 30.79% The increase in consultancy fees shows advisory was taken for some matter.
Doubtful debts 12,718 3,000 9,718 76.41% Although there has been increase in sales income for about 44% yet the captivated amount in doubtful debt is a point tube considered for risk.
Depreciation 69,671 84,383 -14,712 -21.12% Normal cost
Distribution costs 1,925 2,423 -498 -25.87% Increse in sales. Part of operations cost
Donations 7,757 42,574 -34,817 -448.85% There has been a sudden decrease in donations. Comoany does not hold enough cash.
Electricity 25,847 24,305 1,542 5.97% stable...