BUSINESS 1220

2010 - 2011
FINANCIAL MANAGEMENT ASSIGNMENT SCHEDULE
(23 Sessions)

The work noted for each class is to be completed by the student before he or she attends the
class. The completed work will be discussed during class. Complete all work as listed and attend
every class to ensure adequate preparation for the mid-term exam.

Monday, September 13

Topic: Introduction to Business 1220 (handout) & Financial Statements

Read: Financial Statements: Statement of Earnings, Balance Sheet, Statement of
Retained Earnings, pp. 7-28

Wednesday, September 15

Topic: An Introduction to Business 1220

Read: An Introduction to the Case Method, pp. 1-6
In-Class: Please be ready to introduce yourself to the class

Friday, September 17

Assignment:
1. Exercise 2, Crawford Retail Sales, Inc., p. 38
2. Exercise 2, Thomas Hardware Store Ltd., p. 41
3. Exercise 1, Bargain Store Inc., p. 43

Monday, September 20

Assignment:
1. Exercise 2, Oliver Wholesalers – Proprietorship, p. 45
2. Lisa’s Waterbed Emporium Inc., pp. 57-58

Complete exercises from previous class if necessary.

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Wednesday, September 22

Topic: Mini Cases in Financial Statements & Integrating the Financial Statements

Cases: Glenn’s Glue Stick, p. 59

Kelly Automotive, p. 61
Note: Use Working Capital Loan as the PLUG (the balancing figure)

In-Class: Prepare the cases and be ready to discuss how the statements for each of these
companies were assembled.

Take-home quiz for Financial Statements distributed today. The quiz is due MONDAY,
SEPTEMBER 27, 2010.

Friday, September 24

Topic: Statement of Cash Flow

Determining Financial Requirements: preparing and interpreting the Statement of
Cash Flow

Read: Statement of Cash Flows, p. 84-94

Monday, September 27

Topic: Statement of Cash Flow

Assignment: The 10 Beach Hut, pp. 63-65

1. Prepare a Cash Flow Statement. Ensure that you can complete all parts of the exercise on your
own.
2. Assess how the company is using their money to run the business in relation to cash from
operating activities, financing activities, and investing activities.
TAKE-HOME QUIZ DUE TODAY – be prepared to discuss the quiz in class

Wednesday, September 29

Topic: Financial Ratios: Determining Financial Requirements, Preparing Financial Ratios

Read: Financial Ratio Analysis, pp. 94-114

ASSIGNMENT CONTINUED ON NEXT PAGE

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Assignment: Exercise 2, ABC Distribution Co. Ltd., p. 136

Complete statements of earnings and balance sheets for ABC are available on WebCT.

In-Class: Prepare the ratio exercise and be ready to discuss any problems you experienced.

Be prepared to discuss the take-home quiz in class.

Friday, October 1

Topic: Financial Ratio Analysis: Interpreting Ratios

Assignment: Exercise 2, ABC Distribution Co. Ltd., p. 136
Use the ratios you calculated for Wednesday’s class to evaluate the past financial
performance of ABC.

In-Class: Today’s discussion will focus on how we use ratios in conjunction with the
Statement of Cash Flows to assess the financial performance of a company.

Monday, October 4

Topic: Preparing Projected Financial Statements

Read: Financial Management, p. 114-120

Topic: Forms of Businesses & Types of Financing

Read: Financial Management, p. 81-83, 129-131.

Assignment: Exercise 3, DEF Co. Ltd., p. 137, Exercises 1, 2

Note: Always use the bank loan as the plug, not cash.
In-Class: Be prepared to discuss any problems you had in preparing the projections.

Wednesday, October 6

Topic: Preparing Projected Financial Statements

Assignment: Complete from last day Exercise 3, DEF Co. Ltd., p. 137, Exercises 1, 2, 3
Note: Always use the bank loan as the plug, not cash.
In-Class: Be prepared to complete the exercise and discuss any problems

Topic: Cash Flow & Ratio Analysis

Case: Gardiner Wholesalers (A), p. 67

Assignment:
1. Analyze the Cash Flow Statement and financial ratios for ELEGANCE JEWELLERS - NOT
SD Taylor. Elegance Jewellers ratios for Gardiner Wholesalers are available on WebCT.
2. Assess the overall financial position of the company.
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Friday, October 8

Topic: Projected Financial Statements

Case: Gardiner Wholesalers (B), p.79
Gardiner Wholesalers (A), p. 67. Complete case from previous class if necessary.
Assignment:
1. Prepare a set of projected financial statements for Elegance Jewellers for the year ended June
30, 2003.
2. What are the future financial requirements for the company? (What does your plug suggest?)
3. As Kathy Wilson, what recommendations would you make to the credit and sales managers
regarding Elegance’s credit policy?

Monday, October 11

THANKSGIVING – NO CLASS!

Wednesday, October 14

Topic: Determining Financial Requirements for a Company

Sensitivity Analysis, 4C’s of Credit and Seasonality
Read: Financial Management, p. 121-129

Case: Maple Leaf Hardware Ltd., p. 139

Assignment:
1. As Stuart Foreman, assess Maple Leaf’s financial position, given the Cash Flow and Financial
Ratio information.
2. Prepare a set of projected statements for the year ended December 31, 2002 and for the year
ended December 31, 2003.
3. Be prepared to discuss your analysis and your assumptions with the rest of the class.

Friday, October 15

Topic: Determining Financial Requirements for a Company

Sensitivity Analysis, 4C’s of Credit and Seasonality

In-Class: Assessing the credit risk of Maple Leaf Hardware Ltd.

Case: Maple Leaf Hardware Ltd. (continued)

Assignment:
1. Finish preparing the required projected financial statements if incomplete

ASSIGNMENT CONTINUED ON NEXT PAGE

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2. Considering inventory, AR & AP, which account is most sensitive to an increase or decrease
in days? Why? How will a change in this account impact working capital needs? Hint: What
will be the impact on the plug if Days Inventory increases/decreases 15 days? Discuss the
appropriateness of the term of the loan.
3. Discuss any seasonal effects on the company’s’ financing requirements.
4. Given the information that Stuart Foreman has before him, how much money does Maple Leaf
Hardware need?
5. Be prepared to share your findings with the rest of the class.

Monday, October 18

Topic: Completing Comprehensive Financial Analysis

Case: GE Capital Canada, p. 147

Assignment:
1. Analyze the Statement of Cash Flow for the period ending December 31, 2002
2. Analyze and interpret the selected financial ratios.
3. Prepare a set of projected statements for the year ended December 31, 2003.
4. Be prepared to discuss your analysis and your assumptions with the rest of the class.

Wednesday, October 20

Topic: Completing Comprehensive Financial Analysis

Case: GE Capital Canada (continued)

Assignment:
1. Finish preparing the required projected financial statements if incomplete.
2. How did Clark Carriers fare against GE Capital’s formal lending criteria?
3. Are days AR and AP sensitive to fluctuations? Will your plug be significantly impacted by any
changes?
4. Perform a 4 C’s analysis for Clark Carriers. How will this information impact your decision?
5. What recommendations would you make regarding Clark Carrier’s loan request? Why?

Friday, October 22

Topic: Completing Comprehensive Financial Analysis

Case: Lawsons, p.155

ASSIGNMENT CONTINUED ON NEXT PAGE

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Note: Lawsons’ age of payables is 17 days for all non-overdue accounts.

Seasonality adjustment is equal to 4% of sales.

Assignment:
1. Analyze the Statement of Cash Flow for the period ending January 31, 2003
2. Analyze and interpret the selected financial ratios.
3. Prepare a set of projected statements for the year ended January 31, 2004 and for the year
ended January 31, 2005.
4. Be prepared to discuss your analysis and your assumptions with the rest of the class.

Monday, October 25

Topic: Completing Comprehensive Financial Analysis

Case: Lawsons (continued)

Note: Lawsons’ age of payables is 17 days for all non-overdue accounts.
Seasonality adjustment is equal to 4% of sales.
Assignment:
1. Finish preparing the required projected financial statements if incomplete.
2. Determine the financial requirements for Lawsons (what is your plug?)
3. Which current accounts, (days Inv, AP, AR) are most vulnerable to change? How will
fluctuations impact your plug?
4. Analyze the 4 C’s of the company and determine how this will impact your decision.
5. What recommendations(s) would you make regarding Mr. Mackay’s loan request? Why?

Wednesday, October 27

Topic: Completing Comprehensive Financial Analysis

Case: More Vino Ltd. – Expansion Proposal, p. 165

Note: Do not convert currency

1. As Arthur Greenway, assess More Vino’s past financial performance utilizing the company’s
financial ratios and statements of cash flows.
2. Prepare projected Statements of Earnings, Statements of Retained Earnings, and Balance
Sheets for 2008 and 2009.
3. Be prepared to discuss your analysis and your assumptions with the rest of the class

Friday, October 29

Topic: Completing Comprehensive Financial Analysis

ASSIGNMENT CONTINUED ON NEXT PAGE

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Case: More Vino Ltd. – Expansion Proposal (continued)

Note: Do not convert currency

1. Finish preparing the required projected financial statements if incomplete.

2. What are More Vino’s future financial requirements?
3. What effect does your sensitivity analysis have on your plug figure?
4. Perform a Four Cs risk assessment.
5. As Greenway, what are your options?
6. As Greenway, how will you respond to this request for funds? Based on your qualitative and
quantitative analysis, provide detailed rationale for your decision.

Monday, November 1

Topic: Review
Case: Forest of Flowers, p. 175
Assignment:
As Brad MacDougall, account manager at the Business Development Bank of Canada,
carry out an appropriate analysis regarding the request for a long-term loan and make
whatever recommendations you deem advisable.

Note: Your instructor will conduct the class under the assumption that you have set aside four
hours to prepare this case as a practice exam. Use the study sheet to assist you to ensure your
familiarity with it. Come with questions concerning the course material and the exam.

Wednesday, November 3

Topic: Review
Case: Forest of Flowers (continued)

Friday, November 5

Topic: Financial Management Review

In-Class: Bring any questions you may have for your instructor in preparation for the exam.

FINANCIAL MANAGEMENT EXAMINATION

Saturday, November 6, 1:00 - 5:00 p.m.