question 2.2b

2.2 If cash flowing into the business exceeds cash flowing out, then the business can continue to operate" (Oliver & English, 2012, p. 147). a) Jordan has started to sell Kaimanga's products to supermarkets on credit. Kaimanga will be paid one month later but they will need to pay for stock and operating expenses ailechy as they are purchased. Describe what you notice about the figures below and explain the problems Kaimanga faces. (7 marks) Month 1 $8,000 Table 1: Monthly profits Month 2 Month 3 $10,000 $11,000 Month 4 $13,500 Total S42,500 Sales revenue Cost of sales $4,320 $5,400 $5,940 $7,290 $22,950 $1,500 $1,650 $1,850 $1,950 $6,950 Operating expenses Profit $2,180 $2,950 $3,210 $4,260 $12,600 Table 2: Four-month cash flow Month 1 Month 2 Month 3 0 $8,000 $10,000 $5,820 $7,050 $7,790 ($5,820) $950 $2,210 Month 4 $11,000 $9.240 $1,760 Total $29,000 $29,900 ($900) Receipts Payments Cash inflow/outflow Bank Balance ($5,820) ($4,870) ($2,660) ($900) N/A b) Provide a simple plan to assist Kaimanga in getting through any bottle necks demonstrated in the above scenario. Discuss TWO strategies, (8 marks) 2.3 a) Why are internal controls in accounting important in a business operation? (5 marks) b) Identify FIVE key internal controls and explain how each could be applied to Kaimanga. (10 marks) 2.4 Reflect on your learning about operations and accounting as business functions. You might like to consider questions such as: "What did I know before I began studying this topic?", "What have learnt?" and "What worked best for my learning?" (5 marks) NZDB5.03 Business Functions 1017180 2.2 If cash flowing into the business exceeds cash flowing out, then the business can continue to operate" (Oliver & English, 2012, p. 147). a) Jordan has started to sell Kaimanga's products to supermarkets on credit. Kaimanga will be paid one month later but they will need to pay for stock and operating expenses ailechy as they are purchased. Describe what you notice about the figures below and explain the problems Kaimanga faces. (7 marks) Month 1 $8,000 Table 1: Monthly profits Month 2 Month 3 $10,000 $11,000 Month 4 $13,500 Total S42,500 Sales revenue Cost of sales $4,320 $5,400 $5,940 $7,290 $22,950 $1,500 $1,650 $1,850 $1,950 $6,950 Operating expenses Profit $2,180 $2,950 $3,210 $4,260 $12,600 Table 2: Four-month cash flow Month 1 Month 2 Month 3 0 $8,000 $10,000 $5,820 $7,050 $7,790 ($5,820) $950 $2,210 Month 4 $11,000 $9.240 $1,760 Total $29,000 $29,900 ($900) Receipts Payments Cash inflow/outflow Bank Balance ($5,820) ($4,870) ($2,660) ($900) N/A b) Provide a simple plan to assist Kaimanga in getting through any bottle necks demonstrated in the above scenario. Discuss TWO strategies, (8 marks) 2.3 a) Why are internal controls in accounting important in a business operation? (5 marks) b) Identify FIVE key internal controls and explain how each could be applied to Kaimanga. (10 marks) 2.4 Reflect on your learning about operations and accounting as business functions. You might like to consider questions such as: "What did I know before I began studying this topic?", "What have learnt?" and "What worked best for my learning?" (5 marks) NZDB5.03 Business Functions 1017180