Reference no: EM132584859

RMAA UG 114 Research Methods in Accounting and Auditing - College Of Banking And Financial Studies

Research Methods - Concepts and its application

Scenario or Tasks

Task 1

Research is defined as
• A systematic means of problem solving - (Tuckman 1978)

More importantly the research sequence is perfectly synchronized with the above definition as such.

You are required to explain in your own words with appropriate references
a. How it is a systematic way of problem solving
(200 Words)
b. Explain in detail the research sequence, step by step with appropriate examples?

Task 2

• From the following information
- Initial Investment = RO 6,000
- Revenue RO {your Student number} (for 4 years)
- Operating Expenses = RO 500 (for 4 years)
- Rate of Income tax = 25%
- Cost of Capital = 10%
- Tax Depreciation = RO 100

You are required to
a. Calculate NPV and analyze and comment on the results
b. evaluate sensitivity
i. Sensitivity of Revenue, analyze and comment on the results

ii. Sensitivity of Cost analyze and comment on the results

iii. Sensitivity of net tax rate impact analyze and comment on the results

Task 3 :

Marginal costing is the accounting system in which variable costs are charged to cost units and fixed costs of the period are written off in full against the aggregate contribution. Note that variable costs are those which change as output changes - these are treated under marginal costing as costs of the product.
Absorption costing, sometimes called full absorption costing, is a managerial accounting method for capturing all costs associated with manufacturing a particular product. The direct and indirect costs, such as direct materials, direct labor, rent, and insurance, are accounted for using this method
In accounting, a variance is the difference between an actual amount and a budgeted, planned or past amount. Variance analysis is one step in the process of identifying and explaining the reasons for different outcomes. Variance analysis is usually associated with a manufacturer's product costs

Differentiate between Marginal costing, absorption costing and variance analysis, how best these concepts helps us to arrive as decision making process and analyze the cost concepts.

Task 4

Finance is identified as an area which is very active rather than passive. A continuous and active participation is very much needed in terms of a broad understanding of the major topic and in-depth analysis in the specific area.

You are required to discuss and analyze
a. Efficient Market Hypothesis

The efficient market hypothesis (EMH), alternatively known as the efficient market theory, is a hypothesis that states that share prices reflect all information and consistent alpha generation is impossible

b. Portfolio Management and the concept of diversification
Diversification is a risk management strategy that mixes a wide variety of investments within a portfolio. ... The rationale behind this technique is that a portfolio constructed of different kinds of assets will, on average, yield higher long-term returns and lower the risk of any individual holding or security

c. Option pricing
Option pricing theory uses variables (stock price, exercise price, volatility, interest rate, time to expiration) to theoretically value an option. Essentially, it provides an estimation of an option's fair value which traders incorporate into their strategies to maximize profits

Attachment:- Research Methods in Accounting and Auditing.rar