OCR Business Studies F297 2016 - VGL Case Study

Ok.. Is gearing creditors after 1 year/(creditors after 1 year + net assets employed) ?

Im still confuses about the textile maths the powerpoint my teacher gave me said the BEP are 2115 pound per week and the guy who posted his BEP to me said is 3990000 profit per week. Im confused... someone help...

Im still confuses about the textile maths the powerpoint my teacher gave me said the BEP are 2115 pound per week and the guy who posted his BEP to me said is 3990000 profit per week. Im confused... someone help...

lewis, any chance you can explain time series analysis?

TSA Album: http://imgur.com/a/b50Yb

Its a way of forecasting the future using averages basically. (Its bad to use it on its own and its not exactly accurate.)

thank you, what are the calculations for them?

I added the APT page which has the actual calcs. in it

is long term loans/ capital employed times 100
in this case long term loan will be (creditors falling due after one year + net assets employed ) / net assets employed (capital employed) x 100
right?

How to do the seasonal varance ? quarterly moving average take away sales revenue ?

i can't see it? don't trouble yourself, thank you for all the help anyways !

Seasonal variation is as follows:
Actual Sales - trend

Therefore 2012 Q3 = 208-122 = 86(Positive)
2012 Q4 = 124-122.5 = 1.75(Positive)
2013 Q1 = 96 - 123.5 = -27.5 (Negative)
and so on...

You then add up each variation for each quarter and divide by the amount there is - So Q1.
-27.5 + -21.5 = -49 / 2 = -24.5

Therefore -24.5 is the average seasonal variation on all trends in Q1.

On the graph, i exptroplated the line further (the dotted line) and then used the figure i got from the line in the formula to get a more accurate reading, IE.

2015 Q1 = 110 -24.5 = 96.5

hope that helps.



It's fine, i need to revise TSA anyway

try this link: http://prntscr.com/bg6n76 (Its a screenshot.)

For getting the final figure of 96.5, can you not use the average of all quarter 1 figures + the average seasonal variation? That's the way I was taught :/

if you get the same figure and it works, stick with how you were taught, im just explaining how I was taught it works

I just tried it and it doesn't, fml

The mark scheme will have a 10% leeway on the graph readings (I think its 10%, might be more.) as no graph is the same. So extrapolating is your best bet.

have a look at my graph and see if you can work off of that (It only has the averages plotted!)

I can only find your table not graph

So lets look at it this way:

They buy 100 tonnes of textiles for £300 per tonne = £30000 costs

They sell 10% of it at £300, 20% at £400 and so on.. following the table on the BEP thing - This gives them a total revenue of £51,000

Minus direct costs = £21,000 Gross Profit.

There is then the fixed costs of £100,000 per year and £80,000 start up - Lets say it takes 8 years to pay off the startup costs, so £10,000 a year.
That puts our yearly fixed costs at £110,000. Divide that by 52 (there are 52 weeks in a year.) and you get £2115, this is their WEEKLY FIXED COSTS.

Work out the BEP by using Fixedcosts/Contribution(Gross Profit) and you get 0.1, which is 10 tonnes per week to break even.

190tonnes x 21000(revenue) = 3,990,000 weekly profit should they work off the 200 tonnes a week quota (Which is stupid to even try suggest, good job Michael! :P )


TABLE LINK: http://i.imgur.com/7O3ur3y.jpg


-Quote from a PM i sent.-