i have attached the fileMicrosoft Word - 2018 S3 Assignment 1 - ACC00724 ACC00724 Accounting for...

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i have attached the fileMicrosoft Word - 2018 S3 Assignment 1 - ACC00724   ACC00724 Accounting for Managers, Assignment 1, S3 2018        Page 1 of 1  ACC00724 (Accounting for Managers) S3, 2018 ASSIGNMENT 1 (20 MARKS)  In gradebook you will see a section “Company number” with a number between 1 and 3. This is the  number of the company that you are allocated for this assignment.  1. JB Hi Fi Ltd (JBH)                                           http://www.jbhifi.com.au   2. Wesfarmers Ltd (WES)                           http://www.wesfarmers.com.au  3. Woolworths Ltd (WOW)                http://www.woolworthsgroup.com.au  Required:  A. Access the annual reports for your allocated company for the years 2014, 2016 & 2018 in the  Assessment folder of Blackboard. You should only use the figures from the annual reports  provided - do not access your reports or figures from any other source.  B. These annual reports will provide you with six years of financial statements for 2013, 2014,  2015, 2016, 2017 & 2018.   C. Calculate the following ratios for the five years 2014 - 2018 (2013 financial information will  assist you in calculating averages, where necessary). Most ratios are available in the textbook -  and a reference is given for those that are not in the text. 1. Return on total assets (available in your study guide)   2. Rate of return on ordinary equity     3. Operating profit margin  4. Gross profit Margin  5. Inventories turnover period  6. Settlement period for debtors   7. Current ratio  8. Quick ratio (acid test ratio)  9. Debt to assets ratio (available in your study guide)  10. Interest cover ratio (Times interest earned)       11. Assets turnover (available in your study guide)  12. Earnings per share       13. Price-earnings ratio (refer to Blackboard for stock price history for five years).  14. Dividend yield (refer to Blackboard for the dividend history for five years). In each of the ratios, you should firstly write out the ratio formula that you used and then show the  numbers that you used to calculate your answer, before showing your answer. Your answer should be  in a format that indicates whether it is in %, times, ratio or days and to two decimal places.                                                                                                                (3.5 marks)   D. Given the ratios over five years, comment on the company’s profitability, efficiency, liquidity,  financial gearing and investment ratios.  Approximately 1,000 words.  Note: You should also refer to coverage in the financial press that is related to your company. This  will help you in evaluation of the company - please cite your sources!          (8 marks) E. Examine the Statements of Cash Flows of your company for the years 2017 and 2018. Discuss  the changes in each of the cashflows from operating, investing and financing activities. From this  report, what can you glean about the business' activities in each year?  (Approximately 300 words)                                       (5 marks)  F. Using the answers you calculated in part C, enter your answers into the area provided in  Blackboard in assessments before uploading your assignment in the assessments section. This  portion of your assignment will be automatically graded, so it is very important that you follow  the instructions outlined here and in Blackboard.                                                       (3.5 marks)  THE END

Anju P · Accepted Answer

Wesfarmers Limited
Calculation of Financial Ratios 2014-2018
1. Return on Total Assets [Amount in Million $]
= Earnings before Interest and Tax/ Total Assets
= (Net Income + Tax + Interest)/ Total Assets
2014
= (1,605+939+346)/39,727	
= 0.073
2015
= (2,440+1,004+315)/40,402	
= 0.093
2016
= (407+631+308)/40,783	
= 0.033
2017
= (2,760+1,169+248)/40,115	
= 0.104
2018
= (2,604+1,246+211)/36,933	
= 0.110
1. Rate of Return on ordinary equity [Amount in Million $]
=Operating profit/Average Ordinary Equity*100
=Sales- Cost of Goods Sold- All other Expenses/Average Ordinary Equity*100
2014
= (60,181-41,424-16,274)/26,004.50*100
= 9.55%
2015
= (62,447-43,045-16,055)/25,384*100
= 13.19%
2016
= (65,981-45,525-19,459)/23,865*100
= 4.18%
2017
= (64,913-44,633-16,536)/23,445*100
= 15.97%
2018
= (66,883-45,718-17,484)/23,347.50*100
= 15.77%
1. Operating Profit Margin [Amount in Million $]
=Operating Profit/ Total Revenue*100
2014
= 2,483/60,181*100
= 4.13%
2015
= 3,347/62,447*100
= 5.36%
2016
= 997/65,981*100
= 1.51%
2017
= 3,744/64,913*100
= 5.77%
2018
= 3,681/66,883*100
= 5.50%
1. Gross Profit Margin [Amount in Million $]
=Gross Profit/Sales*100
2014
= 18,757/60,181*100
= 31.17%
2015
= 19,402/62,447*100
= 31.07%
2016
= 20,456/65,981*100
=31.00%
2017
= 20,280/64,913*100
= 31.24%
2018
= 21,165/66,883*100
= 31.64%
1. Inventory Turnover Period [Amount in Million $]
=Average Inventory Held/ Cost of Goods sold*365
2014
= 5,191.50/41,424*365
= 45 days
2015
= 5,416.50/43,045*365
= 45 days
2016
= 5,878.50/45,525*365
= 47 days
2017
= 6,395/44,633*365
= 52 days
2018
= 6,270.50/45,718*365
= 50 days
1. Settlement Period for Debtors [Amount in Million $]
= Average Accounts Receivable/Credit Sales Revenue*365
2014
= 1,962.50/60,181*365
= 12 days
2015
= 1,523.50/62,447*365
= 9 days
2016
= 1,545.50/65,981*365
= 8 days
2017
= 1,630.50/64,913*365
= 9 days
2018
= 1,645/66,883*365
= 9 days
1. Current Ratio [Amount in Million $]
=Current Assets/ Current Liabilities
2014
= 9,311/8,229
= 1.13
2015
= 9,093/9,726
= 0.93
2016
= 9,684/10,424
= 0.93
2017
= 9,667/10,417
= 0.93
2018
= 8,706/10,025
= 0.87
1. Quick Ratio [Amount in Million $]
= Cash+ Account Receivable/Current Liabilities
2014
= 2,067+1,584/8,229
= 0.44
2015
= 711+1,463/9,726
= 0.22
2016
= 611+1,628/10,424
= 0.21
2017
= 1,013+1,633/10,417
= 0.25
2018
= 683+1,657/10,025
= 0.23
1. Debt to Asset Ratio [Amount in Million $]
=Total Debt/Total Asset
2014
= 13,740/39,727
= 0.35 times
2015
= 15,621/40,402
= 0.39 times
2016 
= 17,834/40,783
= 0.44 times
2017
= 16,174/40,115
= 0.40 times
2018
= 14,179/36,933
= 0.38 times
1. Interest Cover Ratio [Amount in Million $]
= Operating Profit/ Interest Expenses
2014
= 2,483/346
= 7.18 times
2015
= 3,347/315
= 10.63 times
2016
= 997/308
=3.24 times
2017
= 3,744/248
=15.10 times
2018
= 3,681/211
= 17.45 times
1. Assets Turnover [Amount in Million $]
=Net Sales/Average total Assets
2014
= 60181/41441
=1.45 times
2015
= 62447/40064.50
=1.56 times
2016
= 65981/40592.50
=1.63 times
2017
= 64913/40449
=1.60 times
2018
= 66883/38524
=1.74 times
1. Earnings per Share[earnings and no.of shares in thousands]
=Earnings available to ordinary shareholders/no. of ordinary shares in issue
2014
= 2689000/1143275
= $ 2.35
2015
= 2440000/1123753
= 2.17
2016
=407000/1126131
= 0.36
2017
= 2873000/1133840
= 2.53
2018
= 1197000/1133840
= 1.06
1. Price Earnings Ratio
=Market Price per Share/Earnings per share
2014
= 42.58/2.35
= 18.12 times
2015
= 39.03/2.17
= 17.99 times
2016
= 40.10/0.36
=111.39 times
2017
= 40.

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