Accounting Question

It is
the final assignment so there a few steps to it. Here are the
instructions if you are interested, I Have also included the excel
document

This assignment relates to the following Course Learning Requirements:

• CLR 1 – Prepare a simple cash flow, income statement, and balance sheet from a trial balance.
• CLR 2 – Perform rudimentary bookkeeping transactions.
• CLR 3 – Summarize the legal information and key components of a payroll system suitable for a small business.
• CLR 4 – Prepare a feasibility analysis based on selected criteria for a small business start up.
• CLR 5 – Select critical success factors appropriate for use in a planning and control system for small business.
• CLR 6 – Develop a credit and collection policy for a small business.
• CLR 7 – Apply selected methods of business valuation to justify a purchase decision.

Objective of this Project

To
demonstrate good financial management practices including payroll for a
small business, conduct a feasibility study, and performing valuation
analysis for a small business purchase.

Pre-Project Instructions

1. To prepare for this assignment, review the content in Modules 1 to 13.
2. Review the activities in Excel spreadsheets for modules 3, 4, 5, 10, 12, and 13.
3. This final project is divided into 5 parts.
4. Read the scenario below.

Scenario

Ken
has graduated from an Ontario college business program and is ready to
start a new venture in landscaping. His business name will be Ken’s
Landscaping Enterprises (KLE). He first plans to build clientele by
providing a simple lawn cutting service. Future plans include adding
services such as tree planting, laying decorative stone, and building
decks. Eventually he would like to add snow removal to provide
year-round services for his clients.

Project Tasks

• Record transactions of the new venture
• Prepare financial statements
• Evaluate its performance.
• Develop a payroll system for this business.
• Describe practices to develop a good credit history.
• Identify and describe sources and types of funds available to finance the growth of the venture.
• Analyze the potential purchase of another business.

These
tasks are broken down in to 5 parts. Complete the tasks below with the
intentions of providing good financial management and evaluation
processes for Ken’s venture.

Part 1: Record transactions and create financial statements in Excel – (65 marks) [CLR 1, 2]

1. (35 Marks)
   Go to the Excel file, <MGT2303 – Final Project>
   Go
   the worksheet called <T-Accounts and Trial Balance> and you will
   see Ken’s initial transactions for the month of April 2021.
   1. Record these transactions into the T-Accounts (21 marks)
   2. Create the trial balance. (14 marks)
2. (30 Marks)
   In the same Excel file, MGT2303 – Final Project
   Go to the worksheet called <Financial Statements>
   1. Create the Statement of Income for April, 2021 (10 marks)
   2. Create the Balance Sheet for April 30, 2021 (15 marks)
   3. Create a simple cash analysis showing cash-in, cash-out, and the cash balance. (5 marks)

Part 2: Describe good financial practices in WORD (10 marks – 300 – 500 words in total) [CLR 5, 6]

Background

KLE
is growing. With this growth, Ken feels he is so busy getting new
customers and keeping up with servicing his current customers that he
has little time to determine what policies he should create so that the
business follows good financial practices. He is mostly concerned about
ensuring he develops a good credit rating as he believes the next phase
of the company could require financing. Ken is also concerned with
ensuring cash flow is managed well. He knows he has customers that pay
on credit but is not sure if they are paying on time or if any customers
are long overdue.

1. (6 marks)
   Describe three practices Ken must do to ensure he develops and maintains a good credit rating.
2. (4 marks)
   Describe two practices Ken must do to ensure that accounts receivables are being collected within the time allowed.

Part 3: Conduct a feasibility study in WORD (15 marks – 500 – 750 words total) [CLR 4]

Background

Ken
is ready to grow his business. He is mostly concerned about the
existence of a market for him to grow his business. He is also concerned
with how he will finance his business. He believes he will need an
additional $50,000 in cash for this next phase.

1. (5 marks)
   Describe
   what Ken should do to conduct a market feasibility study for his
   business. Include in the description both quantitative and qualitative
   analyses. Make sure you do not generally describe a market feasibility
   study but describe how that study would be specifically adapted to Ken’s
   business.
2. (5 marks)
   Describe three different sources (excluding love money) and 2 types of financing that will be available to Ken.
3. (5 marks)
   Identify which source and type of financing you believe would be right for Ken and provide 2 reasons to support your answer.

Part 4: Describe features of payroll for KLE in WORD and Excel (15 marks – 200 – 250 words for (a)) [CLR 3]

Background

Ken
has been hiring part time workers and paying them as casual labour for
each lawn they cut. The turnover rate is high and he is continually
looking to replace workers. Finding good workers that will stay is a
major headache for Ken. With KLE’s steady business and a growing list of
customers, Ken feels he can now hire a full-time person to help in all
areas of the business. One of his current workers, Aiesha, would be the
perfect person given her work ethic and friendly demeanor. He would pay
Aiesha $500 a week to start. He is also on the verge of being able to
offer a winter service so that he can provide Aiesha work year-round.

1. (3 marks) Complete in WORD – 250 words.
   Given
   that Ken will have just the one employee now, what software would you
   suggest Ken use for KLE’s payroll? Provide 3 reasons for your
   suggestion. (3 marks) Complete in WORD – 250 words.
2. (12 marks) Complete in Excel
   Go to the Excel file, MGT2303 – Final Project (you were working on in the previous parts of this project)
   Assume that Aiesha’s TD1 relates to column CC1. Use rates from the tax year 2020.
   Go the worksheet called <Payroll>
   For June, 2021
   1. Calculate the weekly net pay for Aiesha showing all deductions (5 marks)
   2. Assuming 4 weeks in a month, show KLE’s detailed monthly remittance to the government (6 marks)
   3. Assuming you are remitting for the June payroll, indicate the date the remittance is due (1 mark)

Part
5: Business Valuation for Purchase – Complete quantitative analysis in
Excel and qualitative analysis in WORD. (35 marks) [CLR 7]

Background

An
opportunity has presented itself to Ken for a snow removal service
company that is for sale. The company seems to have a good reputation in
the community. Ken meets with the current owner, Bjorn, who is 53 years
old. Bjorn tells Ken he’s been clearing snow for 30 years and its time
to slow down and enjoy winters. Bjorn’s company has two trucks with
shovels, two snow blowers, and an assortment of tools. Bjorn has two
part-time workers who he says reliably show up every winter and like the
part-time work structure, hours, and pay. He doesn’t foresee any
problems if Ken were to become the new owner and their new boss.

Bjorn
tells Ken that the landlord of the small storage unit that also has an
office, is very easy to get along with and hasn’t raised the rent in ten
years. He and Bjorn have become good friends. Ken thinks that the unit
would be perfect to operate out of year-round as Bjorn currently has
personal items in the unit that would be removed, such a motorcycle and a
snowmobile. Bjorn tells Ken his company has made around $55,000 –
$60,000 for the past three years, which is pretty good for winter work.
With the company’s good reputation, he would want $200,000 for the
business.

Ken tells Bjorn he is interested in purchasing the
business. However, he first would like to review Bjorn’s financial
statements for the past 5 years. He will also contact a mechanic to
review the trucks and other equipment.

1. (25 marks) Complete in Excel
   Go to the Excel file, MGT2303 – Final Project.
   Go the worksheet called <Valuation>. Financial and additional information is provided.
   1. (i)
      Calculate the value of Bjorn’s business using the asset-based method (8
      marks)(ii) Calculate the value of Bjorn’s business using the
      earnings-based method. (17 marks)
2. (300 – 500 words – 10 marks) Complete in WORD
   1. Using the quantitative calculations from part (a) comment on Bjorn’s asking price of $200,000 for his business.
   2. Then
      use the quantitative calculations and add qualitative analysis to
      provide what you believe would be a fair price for the business. Provide
      at least three good reasons why you feel this price would be a fair
      price.

Project Submissions [Report Format]

This
projects submission will include 1 MS WORD Document and 1 Excel Sheet.
Pay close attention to the guidelines and format described in each part
of the projects instructions.

Submission Guidelines

• For
  the WORD documents, submit your work using the Part numbers as the
  headings. Guidelines for the quantity of words are provided in the above
  tasks.
• WORD document – Include a cover page with the course
  code and course name, the project number, the title of your project,
  your full name and ID, the instructor’s name, and the date the project
  is submitted.
• EXCEL document – Complete the cover page – your full name and ID, the facilitators name, and the date the project is submitted.
• Font should be either Calibri or Arial, 12pt. Text must be single spaced.
• You must cite all your sources of information using APA formatting.
• Create
  a separate reference page that lists all of your sources that you have
  cited in text. Sources include software used. Also, personal
  communications from a professional in the field count as a reference
  source. Visit this link for citation and referencing examples.
• Submit the single WORD document and the single Excel file for grading