Reference no: EM133086536 , Length: word count:2000

6605TECYPC Management and Finance - Liverpool John Moores University

Financial forecasting and report

This report is to be based on the scenario of a new business called Wonder Face Mask (WFM):

Due to the ongoing Covid19 pandemic, wearing facemask has become part of a standard wear required by many countries, which have made wearing facemask mandatory in public places. Your company, WFM have just developed a new style of facemask that has a self- sanitisation feature, which you believe could revolutionise the facemask market. The cost to produce a piece of standardised facemask is RM2.40. After careful market research, you decide to sell it at RM7.90 per piece. You have been requested by a group of potential investors who are very keen on your new venture to develop a 12-month sales plan and provide all relevant financial information to enable them to assess the viability of the venture.

You know that any potential investor will expect you to have a good knowledge of how much your product will cost to produce and also of the expected level of sales and profit your product is predicted to make.

REQUIRED:

Question 1. Production and sales plans:
a) Prepare a 12-monthly production and sales plan table. You are required:
(i) Prepare the sales and production plan in unit and money measures;
(ii) Leave some inventory at the year-end in order to satisfy the sales in the starting of the following year;
b) Present the sale price, production cost and gross profit for your product on a ‘per unit' base and a 12 month base.

Question 2. Produce the following financial documents for the first 12 months of trading :
a. Cash Budget (month by month)
b. Forecast Income Statement for the 12-month period
c. Forecast Statement of Financial position as at the end of 12-month period
(40% of the mark)

Question 3. Write a 2,000 word report to your potential investors to explain the financial data from tasks 1 and 2 above. This report should include the essential components of: Introduction, Main Section, and Conclusion. (40% of the mark)

The purpose of the report is to sell the idea of your new business to potential investors, and persuade them to invest. As this is an accounting and finance module, the emphasis must be financial. Please submit your report via goggle classroom before the due date.

Your potential investors will want to know what return they can expect on their investment. As a minimum they will expect you to provide details of the following:
- Budgeted sales and production
- forecast cash in-flow, out-flow, and the balance
- forecast turnover, cost, expenses and profit
- forecast value of assets, debts, and value of the business
- relevant ratios and comments
You should refer to the data and financial documents from tasks 1 & 2 and include them in the form of appendices to your report. ALL ASSUMPTIONS must be clearly stated and if possible provide the reasons for making such assumptions.

Referencing

In your assignment, you should ensure that you cite and reference all your sources properly, according to the Harvard convention.

Attachment:- Management and Finance.rar