About this Assignment
The purpose of financial forecasts is to assess cu
ent and future fiscal conditions to inform policy and other important decisions. Financial forecasts are fiscal management tools that presents estimated information based on past, cu
ent, and projected financial conditions. This assignment will measure your understanding of the purpose for, and importance of financial forecasts and how they contribute to decision making. Before beginning the assignment, please read the ru
ics carefully to understand the expectations and how your work will be graded. Please write your answers succinctly and remain on topic, answering only to what is asked.
Problem Set
Stock Price Forecast
Problem # 1: Refer to the stock price forecast table provided and any other resource material you deem necessary to address the following:
· Summarize the forecast using 6-10
ief bullet points
· In XXXXXXXXXXwords explain how the forecasters might have utilized the historical data for the stock price to forecast future stock prices and the methodology for forecasting that the forecaster might have used.
· What assumptions did the forecaster use? What might be some of the rational for making the assumptions? How would different assumptions affect the forecast? XXXXXXXXXXwords)
· If you were advising investors regarding the organization's stocks, what would you tell them? Comment on when, and how much (if any) investment should be done, the return they can expect, time frames, and possible risks XXXXXXXXXXwords)
Problem # 2: For this question, please refer to the Dino's After School Trial Balance with ending totals for December 31, 2014 in the table below:
Account
Balance ($)
Checking
15,220
Savings
58,500
Money Market
41,650
Pre-Paid Rent
5,400
Accounts Receivable
81,000
Accounts Receivable Allowances
-6,500
Machinery
122,600
Equipment
80,300
Automobiles
67,500
Accounts Payable
60,000
Loans Payable
21,300
Equity
384,370
1. Using an Excel Spreadsheet, create the Balance Sheet for Dino's After School.
2. Using the information obtained from your Balance Sheet, calculate any one (1) liquidity and any one (1) leverage ratio.
3. Comment on the financial position of the organization, specific to the two ratios you calculated. What is the main reason that Dino's (and other organizations) need a Balance Sheet? XXXXXXXXXXwords)
Problem # 3: Please refer to the corporate tax rates table and the Gross Profit Chart below:
Account
Balance ($)
0 to 50,000
15%
50,000 to 75,000
$7, XXXXXXXXXX% of the amount over 50,000
75,000 to 100,000
$13, XXXXXXXXXX% of the amount over 75,000
100,000 to 335,000
$22, XXXXXXXXXX% of the amount over 100,000
335,000 to 10,000,000
$113, XXXXXXXXXX% of the amount over 335,000
10,000,000 to 15,000,000
$3,400, XXXXXXXXXX% of the amount over 10,000,000
15,000,000 to 18,333,333
$5,150, XXXXXXXXXX% of the amount over 15,000,000
18,333,333 and up
35%
Fiscal Yea
Gross Profit ($)
June, XXXXXXXXXXMay, 2010
261,100
June, XXXXXXXXXXMay, 2012
277,500
June, XXXXXXXXXXMay, 2013
292,000
June, XXXXXXXXXXMay, 2014
300,900
1. Given the information provided here perform your own calculations to show the amount of corporate tax paid for each of the four (4) fiscal years covered in the table above.
2. Is there a pattern? Explain the pattern and what it may suggest about the future performance of the organization. How can this conclusion advise investors and organizational decision makers?
3. If there was a 20% reduction in the Gross Profit for fiscal year 6/12 - 5/13, how might this have changed the gross profit expectations for the 6/13 - 5/14 fiscal year? Provide rationale.
4. Calculate the total expected taxes that would have been paid for these two fiscal years, with the 20% reduction in 6/12 - 5/13 and the resultant expected change in the 6/13 - 5/14 gross profit.
Problem # 4: Explain the concept of departmentalized accounting and the importance of collaboration between departments within an organization, to its success. You may use organizational examples XXXXXXXXXXwords)
Grading Ru
ic
This assignment will be graded based on the following ru
ics:
Category
Unacceptable
Needs Improvement
Good
Excellent
Total Possible Points
Forecasting
There is no summary, advice, or rationale or those given are unclear and illogical (0-2)
Few parts of the summary, advice, and rationale are succinct and logical (3-6)
Most of the summary, advice, and rationale are succinct and logical. (7-10)
The summary, advice, and rationale are succinct and logical XXXXXXXXXX)
12
Balance Sheet
The formatting, calculations, and comments/conclusions are inco
ect or non-existent (1-3)
The formatting, calculations, and comments/conclusions are inco
ect or non-existent (1-3)
Most/many formatting, calculations, and comments/conclusions are co
ect, fairly well formulated and articulated (8-12)
All or most formatting, calculations, and comments/conclusions are co
ect well formulated and articulated (13-15)
15
Taxes
The calculations and analyses are either non-existent or inco
ect. (0-3)
Some of the calculations and analyses are co
ect and based on the information provided (4-7)
The calculations and analyses are mostly co
ect and based on the information provided (8-12)
The calculations and analyses are co
ect and based on the information provided (13-15)
15
Departmentalized Accounting
Did not clearly articulate the necessity of departmentalized accounting nor the importance of co-ordination and collaboration. (0-1)
Attempted to articulate the necessity of departmentalized accounting. (2)
Satisfactorily articulates the necessity of departmentalized accounting and the importance of co-ordination and collaboration. (3)
Clearly articulates the necessity of departmentalized accounting and the importance of co-ordination and collaboration (4-5)
5
Mechanics
Inco
ect spelling, punctuation, capitalization, and use of standard English grammar hinders understanding (0)
Several/Many instances of inco
ect spelling, punctuation, capitalization, and usage of standard English grammar (1)
Few instances of inco
ect spelling, punctuation, capitalization, and usage of standard English grammar (2)
No or very few instances of inco
ect spelling, punctuation, capitalization, and usage of standard English grammar (3)
3
50