1 Academic Services June 2015 Southampton Solent .docx

1
Academic Services
June 2015
Southampton Solent University
Coursework Assessment Brief
Assessment Details
Unit Title: Managing Financial Information
Unit Code: MAR139
Unit Leader: Dr Alex Dimitriadis
Level: 4
Assessment Title: Ship costing
Assessment Number: AE1
Assessment Type: Report
Restrictions on Time/Length: 2 000 words (+/- 10%)
Individual/Group: Individual
Assessment Weighting: 50%
Issue Date: Week commencing 14-Nov-16
Hand In Date: 09-Jan-17
Planned Feedback Date: Week commencing 20-Feb-17
Mode of Submission: Online via turnitin
Number of copies to be submitted: 1
Anonymous Marking This assessment will be marked
anonymously.

Assessment Task
A multinational company headquartered in Japan, is considering
purchasing a small vessel
to import natural rubber (“caoutchouc”) from Malaysia, to be
used by its pharmaceuticals
division. They hope this vertical integration will reduce the
overall cost of their products by
eliminating the middleman. However the return trip cargoes are
not yet finalised.
The company executives are currently considering two
scenarios: a small containership
could carry most of their products (but not the bulkier ones,
which means it might have to
undertake return trips below maximum capacity); a general
cargo ship would guarantee
maximum utilisation of the ship's capacity during the return
voyage.
Your task is to produce a preliminary report in order to help the
company decide which
scenario is the most favourable.
You will have to consider the yearly costs for 2 handysize
vessels (container & general)
operating on the Labuan- Yokohama route. A list of costs is
available in Stopford’s Maritime
Economics 3e (chapter 6). Some of these costs can be quantified
using Drewry’s Ship
Operating Costs Annual Review and Forecast, also available
from the university library.
Other costs will have to be researched (e.g. port fees) or
calculated (e.g. bunkering). When

information is not available it must be forecast; you must
provide adequate references and
justify your calculations when data is not directly available.
Since the company executives are not shipping specialists, your
report is also expected to
classify shipping costs employing an appropriate cost
accounting method, and summarize
them in a table spanning a single page, for easy and
comprehensive comparison.
Finally, based on these yearly costs, as well as the capacity of
each ship, you should
determine the imported rubber’s transportation cost for each
scenario. Your report is
expected to conclude with a recommendation based on said cost
comparison. Additional
recommendations are of course welcome (provided adequate
referencing/justification).
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Academic Services
June 2015
Assessment Criteria
A B C D F
Identification
and
classification
of costs

(25%)
The understanding of
cost behaviour is
demonstrated via an
appropriate
management
accounting style to
facilitate decision
making
A very good range of
costs discussed with
no significant
omissions;
understanding of cost
behaviour is clearly
demonstrated
One or two types of
shipping costs missing or
inconsistent use of direct
costing.
Elementary
understanding of fixed
and variable costs is
shown; inconsistencies
or omissions with the
examples given
Either the range of
costs is not
representative of
actual costs that are

likely to be incurred or
the costs have not
been classified into
fixed or variable
Calculation
of relevant
costs
(25%)
relevant costs is
demonstrated in a
coherent style and
accurate forecasting
A clear understanding
of relevant costs is
demonstrated with
no inconsistencies
with examples given
relevant costs is shown
but with minor
inconsistencies within
examples given
relevant costs is shown
but with some
inconsistencies within
examples given
The concept of

relevant cost has not
been applied or has
not been understood
Conclusions
about the
costs of each
ship and
recommenda
tions
(25%)
Thorough
investigation
generates well-
founded conclusions
based on specific
management
accounting measures
such as unit costs
and breakeven points
Investigation
generates well-
founded conclusions
in line with the
classification and
relevance given
Limited investigation that
leads to conclusions in
line with the
classification

Very little
investigation leads to
generic
recommendation
and/or off-topic
discussion.
No evidence of any
investigation and as a
result conclusions are
missing or
inappropriate.
Discussion is very brief
or not relevant to the
task set
Referencing
and sources
(25%)
Extensive referencing
with proper citation
form
Accurate
referencing/citation
Referencing mostly
consistent/accurate
Some errors in
referencing

Persistent
errors/omissions in
referencing, or none
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Academic Services
June 2015
Learning Outcomes
This assessment will enable students to demonstrate in full or in
part the learning outcomes
identified in the unit descriptors.
Late Submissions
Students are reminded that:
i. If this assessment is submitted late i.e. within 5 working days
of the submission
deadline, the mark will be capped at 40% if a pass mark is
achieved;
ii. If this assessment is submitted later than 5 working days
after the submission deadline,
the work will be regarded as a non-submission and will be
awarded a zero;

iii. If this assessment is being submitted as a referred piece of
work (second or third
attempt) then it must be submitted by the deadline date; any
Refer assessment
submitted late will be regarded as a non-submission and will be
awarded a zero.
http://portal.solent.ac.uk/documents/academic-
services/academic-handbook/section-
2/2o-assessment-policy-annex-1-assessment-
regulations.pdf?t=1411116004479
Extenuating Circumstances
The University’s Extenuating Circumstances procedure is in
place if there are genuine
circumstances that may prevent a student submitting an
assessment. If students are not 'fit
to study’, they can either request an extension to the submission
deadline of 5 working days
or they can request to submit the assessment at the next
opportunity (Defer). In both
instances students must submit an EC application with relevant
evidence. If accepted by
the EC Panel there will be no academic penalty for late
submission or non-submission
dependent on what is requested. Students are reminded that EC
covers only short term
issues (20 working days) and that if they experience longer term
matters that impact on
learning then they must contact a Student Achievement Officer
for advice.

A summary of guidance notes for students is given below:
http://portal.solent.ac.uk/support/official-
documents/extenuating-
circumstances/extenuating-circumstances.aspx
Academic Misconduct
Any submission must be students’ own work and, where facts or
ideas have been used from
other sources, these sources must be appropriately referenced.
The University’s Academic
Handbook includes the definitions of all practices that will be
deemed to constitute
academic misconduct. Students should check this link before
submitting their work.
Procedures relating to student academic misconduct are given
below:
documents/complaints-conduct/student-
academic-misconduct.aspx
Ethics Policy
services/academic-handbook/section-2/2o-assessment-policy-
annex-1-assessment-regulations.pdf?t=1411116004479
services/academic-handbook/section-2/2o-assessment-policy-
annex-1-assessment-regulations.pdf?t=1411116004479
documents/extenuating-circumstances/extenuating-

circumstances.aspx
documents/extenuating-circumstances/extenuating-
circumstances.aspx
documents/complaints-conduct/student-academic-
misconduct.aspx
documents/complaints-conduct/student-academic-
misconduct.aspx
4
Academic Services
June 2015
The work being carried out by students must be in compliance
with the Ethics Policy. Where
there is an ethical issue, as specified within the Ethics Policy,
then students will need an
ethics release or an ethical approval prior to the start of the
project.
The Ethics Policy is contained within Section 2S of the
Academic Handbook:
services/academic-handbook/section-
2/2s-university-ethics-policy.pdf
Anonymous Marking
A copy of the University’s Policy on Anonymous Marking,
process details and student
guidance on submission sheet completion can be found on the
following links, which are also

uploaded on the Student Portal.
Fact Sheet: http://portal.solent.ac.uk/documents/academic-
services/policies-
procedures-guidelines/anonymous-marking-fact-sheet.pdf
Process: http://portal.solent.ac.uk/documents/academic-
services/policies-procedures-
guidelines/anonymous-marking-process.pdf
Grade marking
The University uses a letter grade scale for the marking of
assessments. Unless students
have been specifically informed otherwise their marked
assignment will be awarded a letter
grade. More detailed information on grade marking and the
grade scale can be found on
myCourse.
Policy: http://portal.solent.ac.uk/documents/academic-
services/academic-
handbook/section-2/2o-assessment-policy.pdf
Fact sheet: http://portal.solent.ac.uk/documents/academic-
services/academic-
handbook/section-4/4o-grade-marking-briefing-for-students.pdf
services/academic-handbook/section-2/2s-university-ethics-
policy.pdf
services/academic-handbook/section-2/2s-university-ethics-

policy.pdf
http://portal.solent.ac.uk/documents/academic-services/policies-
procedures-guidelines/anonymous-marking-process.pdf
procedures-guidelines/anonymous-marking-process.pdf
services/academic-handbook/section-2/2o-assessment-policy.pdf
services/academic-handbook/section-2/2o-assessment-policy.pdf
services/academic-handbook/section-4/4o-grade-marking-
briefing-for-students.pdf
services/academic-handbook/section-4/4o-grade-marking-
briefing-for-students.pdf
1- Chris goes into Best Computer store looking for a new
computer. He wants something that is top of the line and
portable. After looking over everything in the store and talking
to Pierre, Chris decides on a 1.3 kilogram-laptop with all the
latest software. Pierre agrees to have the software loaded onto
the laptop and to call Chris when it is ready so he can come
back and pick it up. That night, after all the software is loaded
and Chris was called, a group of robbers broke into the store
and took all the computers in the back room, including Chris’s
new laptop.
Who is responsible for the loss of the laptop, Best Computer or
Chris? Explain your answer.
Answer Chris is responsible for the loss of the laptop since
Pierre loaded the software to make the laptop in a deliverable

state and notified Chris that the laptop was ready to pick up.
According to rule 2 of the transfer of title under the Sale of
Goods Act the title and risk of the laptop has been transferred to
Chris the moment Pierre notified him that the laptop was in a
deliverable state before the robbery took place.
If Chris has not paid for laptop yet then the contract can be
voidable under force majeure which is beyond the power of both
parties and the contract can be discharged by frustration since
the essential element of the contract namely the laptop does not
exist when Chris decided to pay for it.
2-. Doug and Bonnie Jackson built an addition onto their house
which they planned to cover with brick on the exterior. They
went to the nearest brick manufacturer to get some advice and
to select and order the bricks for their home. The
manufacturer’s sales representative showed them several styles
and colours of brick. He recommended one particular type of
brick which was available in several colours and which the
Jacksons selected. Within a week the manufacturer had
delivered the bricks to the Jackson’s home. Bonnie then
arranged for bricklayers to lay them.
After the first winter Doug and Bonnie noticed the bricks were
blistering and flaking and that small holes were appearing on
the surface of the bricks. They immediately contacted the
manufacturer who told them that this was a normal part of the
weathering process and did not constitute a defect in the brick.
The manufacturer refused to send someone to the Jackson’s
home to look at the bricks.
Doug then contacted an experienced mason to investigate the
condition of the bricks. He told them that the bricks gad been
improperly fired so that they lacked the durability to withstand
the temperature extremes of freezing and thawing. He told Doug
and Bonnie that the bricks would have to be replaced
immediately as they would not withstand one more winter.

When the Jacksons confronted the manufacturer with this
information, the manufacturer sent its own mason to inspect the
brick. It then sent a letter to the Jacksons stating that its mason
had found nothing fundamentally wrong with the bricks and that
there was no need to replace them.
Doug and Bonnie decided to take legal action against the brick
manufacturer.
Required: Discuss the arguments, which will be raised by both
the parties and render a decision.
Answer: Doug may argue that he made the purpose of the bricks
clear to the sales representative and relied on the skills of the
seller to supply him with the brick appropriate for the intended
use. Under the sale of Goods Act there is an implied condition
that the bricks provided shall be reasonably fit for the use
intended, however the bricks started blistering and flaking after
the first winter and a professional said that they were unfit.
Doug can seek to repudiate the contract and recover the
purchase price from the seller or get another good batch of
bricks that fit the intended purpose including the cost of
replacing the bricks.
The seller will argue under caveat emptor that it was Doug’s
responsibility to examine the bricks and determine the quality
and fitness for the intended purpose. The seller will also state
that they did all necessary actions within their powers to inspect
the brick and found they were in good condition and the
blistering was a normal condition of the brick.
Court’s decision: The Sale of Goods Act protects the buyer if he
has informed the seller of the purpose intended for the goods
and relied on the skills of the seller to supply a suitable
product. In this case Doug relied on the manufacturer’s skills to
supply him with the bricks intended for the purpose. Doug can
get the purchase price paid for the bricks from the seller or

another good batch of bricks from the seller as a replacement
for the defective bricks. Doug can also purchase the bricks from
another seller and get the price of the new bricks from the seller
and can obtain any extra costs incurred to replace the new
bricks.

1 Academic Services June 2015 Southampton Solent .docx

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