This document provides an assignment brief for a financial management course. It outlines four tasks for students to complete covering various learning outcomes around sources of finance, financial planning, decision making, and evaluating financial performance. The tasks involve preparing cash budgets, analyzing appropriate financing options, and interpreting financial statements for different businesses. Students must meet various assessment criteria to pass and can achieve higher grades by meeting merit and distinction level descriptors through critical analysis, evaluation, and independent research.

1. MFRD Assignment Brief_Sep16.pdf
1
London School of Business & Management
BTEC Levels 4 & 5 HND Business
Centre No 79829
Unit No & Unit Title
Unit No 2; Managing Financial Resources
and Decisions
Course Title BTEC Level 4- HND (Business)
Assessor’s Name Asif Sadiq
Assignment Title MFRD Individual Assignment
Date Set 14th January 2016
Due Date 9th January 2017
Semester / Academic Year September 2016 Semester

2. Unit Outcomes Covered:
On successful completion of this unit a learner will:
1 Understand the sources of finance available to a business.
2 Understand the implications of finance as a resource within a
business.
3 Be able to make financial decisions based on financial
information.
4 Be able to evaluate the financial performance of a business.
GRADING OPPORTUNITIES AVAILABLE
Outcomes/
Grade
Descriptors
AC1.1 AC1.2 AC1.3 AC2.1 AC2.2 AC2.3 AC2.4 AC3.1 AC3.2
AC3.3
√ √ √ √ √ √ √ √ √ √
Outcomes/
Grade
Descriptors
AC4.1 AC4.2 AC4.3 M1 M2 M3 D1 D2 D3
√ √ √ √ √ √ √ √ √
Assessor: Signature: ______________ Date:
___/___/___

3. Tutor Notes
2
Key Points:
work should be submitted by the deadline.
answers to the tasks.
format.
ar
before submitting your
work.
should be used in
every submitted work.
include headings such as:

4. Table of Contents, Introduction, Discussion/Evaluation,
Conclusions, References and
Appendices (if necessary).
content and
understanding of the subject, critical analysis, evaluation,
justifications, key
arguments, correct use of appropriate models/framework etc.
Submission Regulations
1. “Assignment Front Cover Sheet” must accompany every
submitted work [Cover sheet is
available from our Virtual Learning Environment - Moodle].
2. Assignments must be submitted on or before the due date, via
Turnitin. Please refer to
the LSBM Moodle for detailed assignment submission
instructions.

5. 3
Assignment Brief
Purpose of this assignment:
This unit is designed to give learners a broad understanding of
the sources and availability of
finance for a business organisation. Learners will learn how to
evaluate these different
sources and compare how they are used.

6. They will learn how financial information is recorded and how
to use this information to make
decisions for example in planning and budgeting. Decisions
relating to pricing and investment
appraisal are also considered within the unit. Finally, learners
will learn and apply various
techniques to assess the financial performance of an
organization.
Task 1
(LO1: Understand the sources of finance available to a
business)
Scenario:
You work as a finance manager within the Head Offices of
Green Supplies Ltd.
You have been asked to assist the management team in
preparing and forecasting the
company’s expansion. Green Supplies Ltd is a small private
company who began trading in
April 2013. The company supplies fitness products online to
the public; specialising in mid-
range sporting goods and equipment. In 2014, it wishes to
increase its activity in the market
and as such need to identify a variety of options for finance.
Your research has shown that the Celtic Group would be
interested in investing in Green
Supplies Ltd. This could be an option for the company and will
be something for you to
consider, however, in the event that this investment is not
viable, other options of finance
must be explored. The Celtic Group has been keen to enter into

7. a deal of this nature as
market research indicates that internet related businesses are
expected to grow in the UK and
globally.
Your line manager has asked you to explore the cost and profit
implications of various
sources of finance that would be available to Green Supplies
Ltd. In particular, the executives
within the group want to know what the costs would be if the
group was to accept the
investment offer from the Celtic Group.
Requirements:
Task1:
(a) Identify different sources of finance available to Green
Supplies Ltd. This should include
raising funds through a combination of internal and external
sources of finance. You are
required to select at least 5 sources of finance. (Covers AC1.1)
(b) Assess the implications of different sources of finance and
what are the legal, financial
and dilution of control implications (percentage ownerships)
and risks of bankruptcy.
(Covers AC1.2)
4
(c) Evaluate appropriate sources of finance for your business:
you must choose 3 sources

8. that would be appropriate for Green Supplies Ltd; and discuss
the advantages and
disadvantages of your financing choice. (Covers AC1.3)
(d) Analyse the costs of your chosen sources of finance for
Green Supplies Ltd. Provide a
brief explanation of how they would be shown in the Income
Statement and in the Balance
sheet. (Covers AC2.1)
To achieve M1, State which of the source of finance explored in
part (c) is a best fit for Green
Supplies Ltd. Justify your choice and explain why you consider
this choice to be the best fit
for the company’s future plan.
(Task 1 covers assessment criteria AC1.1, AC1.2, AC1.3, AC2.1
& M1)
Task 2
(a) Explain the importance of financial planning and discuss
why it is important to the success
of Green Supplies Ltd. (Covers AC2.2)
(b) Assess different information need of each decision makers
of an organisation. Identify and
assess the information that is needed for a range of decision
makers. (Covers AC2.3)
(c) Explain the impact of loan and equity finances or investment
on the balance sheet and
income statement. (Covers AC2.4)
To achieve M2, You are required to identify the information

9. needs of internal and external
stakeholders and you must choose at least five stakeholders for
Green Supplies Ltd.
(Task 2 covers assessment criteria AC2.2, AC2.3, AC2.4 & M2)
Task 3.
Scenario:
Heath limited is a medium size company dealing with the
production and sales of electronic
parts. The management of the company has decided to expand
and locate its production
capacity locally. The company has presented its expansion plan
to the finance manager to
evaluate the financial position of the company and its ability to
expand locally.
You have been asked to prepare a cash budget for four months
starting from June 2015 on
the basis of the information given below:
The opening balance of cash on 1st June 2015 is £50000.
Monthly credit sales for the four
months ending September 2015 are forecasted below: Customers
are allowed one month
credit from the date of sale.

10. 5
Months Amount (£)
June 750,000
July 812,000
August 970,000
September 910,000
Cash sales between June and September 2015 are:
Months Amount (£)
June 45000
July 50000
August 65000
September 82000
Cash purchases during the relevant periods are:
Months Amount (£)
June 410,000
July 480,000

11. August 510,000
September 550,000
A new supplier has offered 30 days credit to Heath limited
starting from June 2015; this
means that goods bought on credit in June will be paid in July
and so on. The company plans
to make the following credit purchases from the supplier.
Months Amount (£)
June 76,000
July 82,000
August 86,000
September 90,000
6
The company pays rent of £10,000 per month quarterly in
advance. Payments are due on 1st
June & 1st September.
Other expenses are estimated as follows:

12. Months Amount (£)
June 82,000
July 83,000
August 94,000
September 110,000
The company will be repaying a Bank Loan of £20,000 per
month. The last instalment is due
in September 2015. Other expenses are paid in cash within the
same month.
Requirement:
Prepare the Cash Budget for four months ending September
2015. (Covers AC3.1)
To achieve M3, You are required to explain whether the
business has a surplus or a deficit. If
Heath limited has a surplus, suggest two ways in which it could
utilise this and if it has a
deficit, suggest two ways it could deal with deficit situation.
…………………………………………………………………………
…………………………………
Task3 (b) Paracha limited deals in the production of sports
equipment. You have been
appointed as a production manager in the company and you have
been asked by your line
manager to calculate the selling price and the targeted profit of
the business.

13. The cost of equipment per unit is as shown below:
Variable Cost per unit: £200
Fixed Cost per unit: £100
Total Cost per unit: £300
The company is currently reviewing its selling prices and is
considering cost-plus pricing
based on:
Requirement:
(i) Calculate the selling price per unit with 33% mark up on cost
and calculate profits on 500
units sold. (Covers AC3.2)
You have been informed the fixed cost is fully recovered if 500
units are manufactured and
further production will not result in any additional fixed cost.
The manager wants to know:
(ii) Calculate the selling price per unit after 500 units sold with
30% mark up and the profit on
additional 1000 units sold. (Covers AC3.2)
…………………………………………………………………………
……………………………………
7
Task 3C.
Scenario:
Day Choice Ltd is a small company which manufactures electric

14. items. The company has
three investment options. As a finance manager of the company
you are required to provide
an investment appraisal report on which project would generate
more benefits to Day Choice
Ltd.
You are required to use the Net Present Value (NPV) and
Payback Period techniques to
evaluate which project the company should select for its
investment.
The following information is provided:
Discount rate: 10% (The estimated cost of capital per annum).
Note –The discount factors are as follows:
Year 1 = 0.909
Year 2 = 0.826
Year 3 = 0.751
Year 4 = 0.683
Cash Flow Project A Project B Project C
Investment (Cash Outflow) £150,000
£175,000 £160,000
Year 1- Cash Inflow £30,000
£55,000 £33,000
Year 2- Cash Inflow £48,500

15. £55,000 £40,000
Year 3- Cash Inflow £56,000
£55,000 £55,000
Year 4- Cash Inflow £70,500
£55,000 £58,000
Requirement:
Assess the viability of each project using the following
investment appraisal techniques and
briefly explain which project you would recommend and why?
(Covers AC3.3)
yback Period (years)
To achieve D1: You are required to discuss the advantages and
disadvantages of both (NPV
& Payback Period) methods as well as provide justification of
their use for strategic decisions
making.
(Task 3 covers assessment criteria AC3.1, AC3.2, AC3.3, M3 &
D1)

16. 8
Task 4:
Scenario:
The following information relates to the financial performances
of a wholesale and a Retail
business.
Wholesale
Business
Retail Business
£ £
Sales 580,000 426,000
Cost of sales 430,000 325,000
Gross Profit 150,000 101,000
Total expenses 65,000 40,000
Net Profit 85,000 61,000
Wholesale
Business

17. Retail Business
£000 £000 £000 £000
Fixed assets 4,440 6,550
Current assets
Stock 1,420 2,370
Debtors 1060 2,690
Bank 30 10
Total Current Assets 2510 5,070
Total Assets 6,950 11,620
Capital 3,000 5,500
Long Term Loans 2400 3,170
Current Liabilities 1550 2,950
Total Liabilities 3,950 6,120
Total Capital +
Liabilities
6,950 11,620
Requirement:
(a) Explain the main financial statements produced by a

18. business. (Covers AC4.1)
(b) Compare appropriate formats of financial statements
(Income statement and balance
sheet) for a Sole Trader and a Public Limited Company. (Covers
AC4.2)
(c) Interpret financial statements using appropriate financial
ratios and compare the following
ratios for the wholesale and retail businesses:
(i) Gross Profit Margin
(ii) Net profit Margin
(iii) Current Ratio
(iv) Quick Ratio
(v) Gearing
9
To achieve D2, you must use the Harvard style of referencing
and you must adopt an
effective approach to independent academic research.
To achieve D3, you must analyse the above financial ratios and
interpret the ratios for
wholesale and retail business.
(Task 4 covers assessment criteria AC4.1, AC4.2, AC4.3, D2 &
D3)

19. Grading Criteria (Pass, Merit, Distinction)
Learning Outcomes Assessment Criteria for Pass
LO1 Understand the sources of
finance available to a business
AC1.1 Identify the sources of finance available to a
business.
AC1.2 Assess the implication of different sources.
AC1.3 Evaluate appropriate sources of finance for a
business project.
LO2 Understand the implications of
finance as a resource within a
business
AC2.1 Analyse the cost of different sources of finance.
AC2.2 Explain the importance of financial planning.
AC2.3 Assess the information needs of different
decision makers.
AC2.4 Explain the impact of finance on the financial
statements.
LO3 Be able to make financial
decisions based on financial
information.

20. AC3.1 Analyse budgets and make appropriate
decisions.
AC3.2 Explain the calculation of unit costs and pricing
decision using relevant information.
AC3.3 Assess the viability of a project using investment
appraisal techniques.
LO4 Be able to evaluate the
financial performance of a
business.
AC4.1 Discuss the main financial statements.
AC4.2 Compare appropriate formats of financial
statements for different types of business.
AC4.3 Interpret financial statements using appropriate
ratios and comparisons, both internal and external.
10

21. Grade Descriptors for MERIT
Possible evidence that the learner may provide
M1 Select / design appropriate
methods / techniques
M2 Select / design appropriate
methods / techniques
M3 Present and communicate
appropriate findings
To achieve M1, State which of the source of finance
explored in part (c) is a best fit for Green Supplies Ltd.
Justify your choice and explain why you consider this
choice to be the best fit for the company’s future plan.
(Task 1)
To achieve M2, You are required to identify the
information needs of internal and external stakeholders
and you must choose at least five stakeholders for
Green Supplies Ltd. (Task 2)
To achieve M3, You are required to explain whether the
business has a surplus or a deficit. If Heath limited has a
surplus, suggest two ways in which it could utilise this

22. and if it has a deficit, suggest two ways it could deal with
deficit situation. (Task 3)
Grade Descriptors for DISTINCTION
Possible evidence that the learner may provide
D1 Use critical reflection to evaluate
own work and justify valid
conclusions.
D1: To achieve D1: You are required to discuss the
advantages and disadvantages of both (NPV & Payback
Period) methods as well as provide justification of their
use for strategic decisions making.(Task 3C)
D2 Take responsibility for
managing and organising
activities
D3 Demonstrate convergent / lateral
/ creative thinking
D2: To achieve D2, you need to show the use of
Harvard style of referencing. You must demonstrate an
effective approach to independent research in
(Task 1–Task 4)

23. D3: To achieve D3, you must analyse the financial ratios
and interpret the results of financial ratios for wholesale
and retail business. (Task 4)
MFRD ASSINGMENT 1 (2).pdf
MFRD ASSINGMENT 1
by Cisco Lawal
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24. FINAL GRADE
2/5
MFRD ASSINGMENT 1
GRADEMARK REPORT

25. GENERAL COMMENTS
Instructor
Grade s : 1=No submission; 2=Referral; 3=Pass;
4=Merit; 5=Distinction
Ref erral
O ve rall Fe e dback: Yo u have no t satisf ied the
learning o utco mes and assessment criteria to
achieve a Pass grade.
[Check co mments o n yo ur paper f o r additio nal
f eedback]
Le arning O ut come s
LO1: Achieved/Failed
- 1.1: Achieved
- 1.2: Achieved
- 1.3: Achieved
LO2: Achieved/Failed
- 2.1: No t Achieved
- 2.2: Achieved
- 2.3: Achieved
- 2.4 : No t Achieved
LO3: Achieved/Failed
- 3.1: No t Achieved
- 3.2: No t Achieved
- 3.3: No t Achieved
LO4 : Achieved/Failed
- 4 .1: Achieved
- 4 .2: No t Achieved
- 4 .3: Achieved
Merit Descripto rs

26. M1: No t Evident
M2: No t Evident
M3: No t Evident
Distinctio n Descripto rs
D1: No t Evident
D2: No t Evident
D3: No t Evident
Le arning out come s (LO ) On successf ul
co mpletio n o f this unit a learner will:
Asse ssme nt crit e ria (AC) T he learner can:
For a PASS
LO 1 Unde rst and t he source s of f inance
available t o a busine ss
AC1.1 Identif y the so urces o f f inance available to
a business
AC1.2 Assess the implicatio n o f dif f erent
so urces
AC1.3 Evaluate appro priate so urces o f f inance
f o r a business pro ject
LO 2 Unde rst and t he implicat ions of f inance
as a re source wit hin a busine ss
AC2.1 Analyse the co st o f dif f erent so urces o f
f inance
AC2.2 Explain the impo rtance o f f inancial
planning
AC2.3 Assess the inf o rmatio n needs o f dif f erent
decisio n makers

27. AC2.4 Explain the impact o f f inance o n the
f inancial statements
LO 3 Be able t o make f inancial de cisions
base d on f inancial inf ormat ion
AC3.1 Analyse budgets and make appro priate
decisio ns
AC3.2 Explain the calculatio n o f unit co sts and
pricing decisio n using relevant inf o rmatio n
AC3.3 Assess the viability o f a pro ject using
investment appraisal techniques
LO 4 Be able t o e valuat e t he f inancial
pe rf ormance of a busine ss
AC4 .1 Discuss the main f inancial statements
AC4 .2 Co mpare appro priate f o rmats o f f inancial
statements f o r dif f erent types o f business
AC4 .3 Interpret f inancial statements using
appro priate ratio s and co mpariso ns, bo th
internal and external
Crit e ria f or Me rit - with po ssible evidence
M1 Ide nt if y and apply st rat e gie s t o f ind
appropriat e solut ions
M1: T o achieve M1, State which o f the so urce o f
f inance explo red in part (c) is a best f it f o r Green
Supplies Ltd.
Justif y yo ur cho ice and explain why yo u co nsider
this cho ice to be the best f it f o r the co mpany’s
f uture plan. (T ask 1)
M2 Se le ct / de sign appropriat e me t hods /
T e chnique s
M2: T o achieve M2, Yo u are required to identif y
the inf o rmatio n needs o f internal and external
stakeho lders

28. and yo u must cho o se at least f ive stakeho lders
f o r Green Supplies Ltd. (T ask 2)
M3 Pre se nt and communicat e appropriat e
QM
QM
f indings
M3: T o achieve M3, Yo u are required to explain
whether the business has a surplus o r a def icit. If
Heath limited has a
surplus, suggest two ways in which it co uld utilise
this and if it has a def icit, suggest two ways it
co uld deal with def icit situatio n. (T ask 3)
Crit e ria f or Dist inct ion - with po ssible evidence
D1 Use crit ical re f le ct ion t o e valuat e own
work and just if y valid conclusions
D1: T o achieve D1: Yo u are required to discuss
the advantages and disadvantages o f bo th (NPV
& Payback
Perio d) metho ds as well as pro vide justif icatio n
o f their use f o r strategic decisio ns making.(T ask
3C)
D2 T ake re sponsibilit y f or managing and
organising act ivit ie s
D2: T o achieve D2, yo u need to sho w the use o f
Harvard style o f ref erencing. Yo u must
demo nstrate an
ef f ective appro ach to independent research in
(T ask 1– T ask 4 )

29. D3 De monst rat e conve rge nt /lat e ral/ cre at ive
t hinking
D3: T o achieve D3, yo u must analyse the
f inancial ratio s and interpret the results o f
f inancial ratio s f o r who lesale
and retail business. (T ask 4 )
PAGE 1
PAGE 2
PAGE 3
PAGE 4
PAGE 5
AC 1.1 - Achieved
Yo u have identif ied so urces o f f inance available available f
o r business
PAGE 6
AC 1.2 - Achieved
Yo u have assessed the implicatio n o f dif f erent so urces o f
f inance .
QM
QM
QM

30. QM
QM
QM
QM
QM
QM
QM
PAGE 7
PAGE 8
AC 1.3 - Achieved
Yo u have addressed AC1.3.
AC 2.1 - Not Achieved
Yo u have no t explained the co st o f so urces o f f inance.
AC 2.2 - Achieved
Yo u have explained the impo rtance o f f inancial planning.
PAGE 9
AC 2.3 - Achieved
Yo u have discussed the inf o rmatio n needs o f dif f erent
decisio n makers o f an o rganisatio n
AC 2.4 - Not Achieved
Yo u have no t stated the impact o f f inance o n the f inancial
statements

31. PAGE 10
AC 3.1- Not Achieved
Yo ur cash budget attempt is inco rrect. T here are so me erro rs
in the entries yo u have made
in the cash budget.
PAGE 11
AC 3.2 - Not Achieved
T he calculatio n o f unit co sts and pricing decisio n is inco
rrect.
PAGE 12
AC 3.3 -Not Achieved
Yo ur assessment o f the viability o f a pro ject by investment
appraisal techniques has erro rs in techniques and need impro
vements.
PAGE 13
PAGE 14
AC 4.1- Achieved
Yo u have explained the purpo se o f the main f inancial
statements
PAGE 15
AC 4.2 - Not Achieved
Yo u have no t adequately co vered the appro priate f o rmats o
f main f inancial statements o f

32. QM
dif f erent businesses.
PAGE 16
PAGE 17
AC 4.3 - Achieved
Yo u have calculated the f inancial ratio s f o r all businesses.
PAGE 18
PAGE 19
MFRD ASSINGMENT 1by Cisco LawalMFRD ASSINGMENT
1GRADEMARK REPORTFINAL GRADEGENERAL
COMMENTSInstructor