Btec Unit 2 Assessment 2 Questions (Criteria P7, M3, D1, D2 & D3) by Carole Brown

How can I layout my work for P7?

brownc10 — 2015-11-23 13:46:25 UTC

CB said; write the description of the three ratios. Then compile a table for the rest of the information (ratio name, 2013, calculation, 2014 calculation, change (difference between each year) and adverse/favourable (negative change or positive change)

Do we have to explain every type of ratio listed and the benefits of using them??

brownc10 — 2015-11-23 14:09:41 UTC

CB said; No! You only explain the three TYPES of ratio (liquidity, profitability and efficiency) and the benefits of using each group of ratio.

Return on capital employed - what are the benefits?

2015-11-23 14:27:24 UTC

CB said; If you look at the reasons for completing the ratios/what the information tells you, you should be able to answer this part of the questions. But please remember this is just a pass task and does not need to be massively detailed (just a sentence or two is fine).

What are the benefits of using a Liquidity Ratio Please

2015-11-24 09:48:47 UTC

When calculating the current ratio, if I get 1.6, would I round this up to 2?

2015-11-24 10:07:24 UTC

CB Said; No. Please keep to 1 decimal place for liquidity ratios.

Assignment Brief

brownc10 — 2015-11-24 11:01:43 UTC

whats an adverse change?

2015-11-24 11:12:41 UTC

Adverse means NEGATIVE. Therefore is the change positive (favourable 0r negative (adverse)

hello carole darling, i just had a question. why does gross profit change? thanks for the help.

2015-11-25 10:12:40 UTC

Why hello strange person!!

GP Decreases usually for one of two reasons. Either Revenue has increased (higher price or volume of sales) or the cost of sales has decreased (new supplier or new deal negotiated?)

how having as low percentage would affect them? because they are charity they don't have shareholders so surely having a low ROCE wouldn't affect them?

2015-11-25 13:32:43 UTC

while one strand of the theates operations is that of the charity, they also have out and about, ovation restaurant, mayflower enterprises, corporate functions and the new business mayflower productions that are all limited companies and therefore the ROCE would need to be higher because these organisations have shareholders.

When working out the Return of Capital Employed, I need to work out roce or rosf or both ?? .... Thanks

2015-11-25 13:53:43 UTC

You only calculate the ROCE Return on Capital Employed.

For Creditors Days would and increase of days be Adverse or Favourable

2015-11-25 15:45:59 UTC

No this would be good, so long as they do not go too high (above 90 days) as this is likely to mean suppliers will start to take credit limit and discounts etc away.

For the "What these differences could be a result of " on the Acid Test Ratio What could this be a Result of?....Thanks

2015-12-11 11:15:57 UTC

Carole

brownc10 — 2016-11-24 12:03:45 UTC

Example