Accounting Management Analysis Assignment

Accounting Management Analysis Assignment

student
Background

You, RCMAG (Rotman Commerce Management Accounting Guru), have been

approached by your friend, Justyna, about an opportunity to open a small business at

the heart of St. George Market (“SGM”). SGM is a small quaint marketplace at the

outskirts of a developing area just outside of Toronto. SGM has a similar concept to that

of the popular St. Lawrence Market in Toronto, Ontario. Justyna works in Toronto and

really enjoys visiting the many vendors, merchants, and artisans at the St. Lawrence

market whenever she has the chance to. Visiting for lunch and a great cup of coffee

(and homemade chocolate) is welcomed leisure time!

Justyna was contacted by one of the vendors at SGM to inform her that there are some

openings at SGM. Justyna has dreamed about the possibility of opening up her own

shop at one of these markets. Given the growing area that SGM is located, she believes

that this would be a great opportunity to realize this dream. Justyna has approached

you as a long-time trust friend as she knows that you have the skills to help start this

business up.

Justyna:

RCMAG! How are you? Listen, I have a proposal for us and need your help! My buddy

at the SGM has informed me that there is space for a new vendor. It’s a fantastic

opportunity. Here are some of the parameters:

– One vendor location

– There is a small backroom which we can turn into a prep area (to

prepare/assemble food or store inventory)

– The rent will be $900 per month

– Basic utilities are included, however it’s an extra $30 per month for WiFi

– Everything will be set for us to go, so we won’t have to worry about purchasing

equipment (it’s a simple booth/store that has a register and our goods)

– We should start small with 3 products (more information below in requirements); I

need your help choosing the 3 products and providing some costing options

– I will take care of the rest (signing the space, marketing, etc.)

– I primarily need your “brains” for the accounting and finance stuff!

RCMAG (you):

Wow, Justyna! This is a great opportunity. I am in! I will prepare something for you to

review next week. I am excited!©Amy Kwan, RSM22 Individual Assignment Summer 2021 Page 2 of 3

Required:

1. [Start] Choose two (2) ‘start-up’ products that you propose to sell at the store

Parameters:

Requires some assembly (i.e., materials and labour/machine hours)
Assembly (manufacturing) can be done on and/or off-site (keep in mind
the spacing of the booth)

Product not too complex (recommendation is to keep it simple; think of
things that you might find at small markets (food or retail)).

2. [PPT] Provide two costing options and recommended selling price for each

product as a single stand-alone unit sold (i.e., cost and price for single unit):

Reference the products/options as: Product 1-A, Product 1-B… Product 2-
A, Product 2-B

Explain the differences, pros/cons, assumptions, consideration points of
each costing option to Justyna (remember, she is not an accountant!)

Make sure to clearly outline your costing notes and assumptions
Hint: think about the cost elements you can assess and change
Recommended format: create 2-3 slides with options, assumptions and
recommendations for each product; include general calculations

3. [PPT] Adding complexity: Include as part of your PPT slide deck some

considerations, including but not limited to thoughts such as: bundle sales,

discounts, seasonality (depending on your product), etc.

Name this section of your slide deck “decision-making – strategic and
operational considerations”

4. [Excel] Budgeted Forecast (MS Excel) and Scenario Analysis of your first 12-

months of operations (sales and costs/expenses under various scenarios):

At the top of each ‘worksheet’ (or for each scenario forecast provided),
name the file with a scenario number and title that reflects the basic

parameters and assumptions, i.e., Budgeted Forecast Scenario 1: Product

1-A & Product 2-B

You may find that there could be a seemingly endless number scenarios
to forecast for. Simply state and discuss in your PPT presentation the

possible scenarios you considered, and highlight the scenarios that you

chose to forecast for (provide some justification as to why you chose these

particular scenarios)

Provide a minimum of 3 budgeted forecast scenario analysis (sky’s the
limit, but please don’t overextend yourself!)

Make sure to clearly outline your budgeting/forecasting notes and
assumptions©Amy Kwan, RSM22 Individual Assignment Summer 2021 Page 3 of 3

5. [Submission] Polish your presentation package to Justyna. Submit your PPT file

(maximum 15 ‘core’ slides, i.e., not including cover page, table of contents,

appendices) and Excel file (minimum 3 scenarios budgeted/forecasted) to the

Assignment Submission link via Quercus by Sunday August 15, 2021 11pm ET.

Evaluation guideline:

Demonstration of applying and incorporating management accounting concepts
from RSM222 to the proposal (i.e., ideas, thoughts, considerations)

Professional presentation with the purpose, objective, and audience in mind
Sound and reasonable costing analysis with justification (i.e., thought process)
Presentation of budgeting and forecasting scenarios based on sound and
reasonable assumptions, analysis and consideration

Consideration and application of management accounting decision-making
concepts and context of the business environment and proposal

Additional information about evaluation:

In addition to evaluating the core project deliverables the assessment will consider:

Communication Skills: appearance, tone, structure, technical execution
Technical Skills: choices/judgements, adequately addressing the questions
Professional Skills: understanding of role, context, and critical thinking
Requirements: 2000

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