Reflection On Leadership Competency - 1453 Words

Introduction This reflection on my leadership development was key to understand the fundamentals of leadership development. Having already acknowledged that leadership development is a self-development on-going process, I now realize that it requires deliberate practice based on a serious self-assessment to become a better learner before to become a better leader (Smith, 2017). As learning how to learn can be challenging, the NCHL Leadership Competency Model seems to be the perfect method to teach me how to learn (NCHL, 2016). Thus, this assignment is my reflection about the leadership competencies developed during my practicum completed at Brockville General Hospital (BGH) in June 2017. The first artifact for my Capstone Leadership†¦show more content†¦Peeling the multiple layers of the problem, allowed me to identify the causal relationship and to evaluate the values and the risks for each key element of the process. Then, by weighting all factors, I was able to present simple and viab le solutions to improve the processes. The senior leadership team was able to make an informed decision based on risk mitigation and value-added to the processes presented in the risk-benefit assessment matrix. Presenting the result of my analytical thinking competency, created an immediate engagement from the senior leadership team to go ahead with one of the recommended options. Communication skills I presented a fifteen minutes PowerPoint presentation and drafted a case study report using the official BGH format. For the presentation, I respected the time allotted, stayed on the topic, and prepared to answer any questions throughout the presentation. The feedback received from my preceptor, and the BGH’s Supervisor was very positive. They acknowledged that I was well prepared, that I presented all the pertinent elements in a logical order, and that I engaged my audience throughout the presentation. Furthermore, from the comments and the questions from the Senior Leadership Team, I can attest that they agreed with the redefined issues and with the proposed options. Considering that some elements of my presentation could have been sensible, I was able to communicate with empathyShow MoreRelatedPersonal Statement : A Student Affairs Practitioner1749 Words   |  7 Pagesrequires. â€Æ' Reflections on Competencies Personal and Ethical Foundations (PPF) At first, this competency to me seems like a very unnecessary competency. Almost as if the idea that we had to have integrity in our work would be a given. But apron reflection I see now that statement is not necessarily untrue, but there is so much more to it than that. What it means to have integrity is subjective and contextual. Being able to really be competent in this area requires significant attention, reflection, andRead MoreThe Attributes of a Registered Nurse807 Words   |  3 Pageshealthcare. 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My tendency to over- analyze directly impactsRead MorePast Officer Case Study1174 Words   |  5 PagesKappa Gamma? 0-1 year 2-5 years 6-9 years 10 or more years Our Competency Work Based on the scale below, how important are each of these p ersonal development competencies to an officer role in Kappa Kappa Gamma? Accountability Confidence Credibility Creativity Emotional intelligence Humor Initiative Integrity Resiliency Receiving feedback Self-awarennss Self care 9. Based on the scale below, how important are each of these j ob competencies to an officer role in Kappa Kappa Gamma? Analyzing and assessmentRead MoreReflection On Nursing Leadership1284 Words   |  6 PagesReflection on Nursing Leadership Leadership is often defined as the process of â€Å"influencing the thinking and action of others with respect to achieving a goal† (Gaudine Lamb, 2015, p. 2). 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Much to my surprise, already after the first reading and discussionRead MoreArticulation Of Competence : Strategic Mobilizer1158 Words   |  5 PagesThis ability includes understanding the bigger picture of organizational goal, placing people in the right place, and having a flexibility to make necessary adjustments in their strategy when situations go off track. Leaders who advance in this competency know how to articulate a sharing vision and communicate the vision to others. He or she also know how to analyze their organization’s challenges and provide solutions. A key concept t hat shaped my understanding is the idea of leaders as system thinkersRead MoreAn Objective For The Week 5 Reflection Paper1552 Words   |  7 Pages An objective for the week 5 reflection paper includes highlighting and summarizing some of the most distinctive core competencies that were galvanized as the result of exposure to course materials. The topics discussed over the previous 4 weeks have helped to identify and distinguish between various key leadership elements which stand to benefit tremendously from developing a conscious awareness pertaining to the concepts themselves. Throughout life, individuals must overcome a seemingly infinite

Essay about Gun Control Will Not Reduce Crime - 1076 Words

Introduction The implementation of gun control in the United states is a large problem as it will take away the 2nd Amendment rights and would also stop the ability of law abiding citizens to protect themselves from criminals who obtain guns illegally. The right to bear arms is promised to citizens of the United States, and to put gun control into effect is to take away their Constitutional rights. Crime is very high in cities that have few gun control laws. However, the problem will not be solved by taking guns away from people who are registered and licensed to carry them. Americans have never responded well historically to prohibitions. For example, during prohibition of alcohol, many ways were found to obtain alcohol illegally, Gun†¦show more content†¦Another possible solution to gun control is to require all gun owners to have a license, and take a course on gun ownership with the police department. This would limit the problem of crime and gun related accidents. Rivkin explains how a majority of gun related accidents last year were from people who did not understand how to use a firearm, â€Å"according to the CDC, there were are about 19,000 gun related accidents last year, a majority of those were teenagers and adults who did not know how to properly use a gun.† (Rivkin, 2013). Requiring one to have a license and to take firearm handling classes would limit the amount of firearms on the streets as well as bring down the percentage of gun related accidents in the United States. With authority efforts to remove guns from those who obtaining them illegally, and the registration of weapons, along with required training to teach people how to store and use guns safely the need for gun control would no longer exist. It is already easy to obtain a gun illegally, and gun control could result in similar methods of obtaining weapons illegally. If gun control were implemented the illegal gun trade that is already easily available to people would increase. While law enforcement would be eliminating one problem, it would create another if gun control is is put in place. In his article How Criminals Get Guns David Noyes talks about how guns are already being soldShow MoreRelatedGun Control Will Not Reduce Crime Essay1532 Words   |  7 PagesIn Just Take Away Their Guns, author James Q. Wilson argues that Legal restraints on the lawful purchase of guns will have little effect on the illegal use of guns (Wilson 63). Wilson points out that it would be tough to remove all legally purchased guns from the streets and nearly impossible to confiscate illegally purchased guns. Gun advocate J. Warren Cassidy argues that The American people have a right to keep and bear arms. 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Criminals will always have ways of getting weapons, whether it be from the black market, cross borders, or illegal street sales. New gun control laws will not stop them. Since the shootings of Columbine High School, Virginia Tech, and Sandy Hook, the frequency of mass shootings has increased greatly. Gun control is not effective as it has not been shown to actually reduce the numberRead MoreGun Control Does Not Reduce Crime Essay2327 Words   |  10 Pageswon’t even consider an opposing argument. Gun control is third on the list of subjects in which people are not willing to listen to the opposition’s argument. One side of the gun control argument is that we need more gun control. The opposing side says we don’t need stronger laws, or we need fewer laws. My stand on the argument is that we do not need stronger gun control laws. The thesis of this paper will focus on the argument against tougher gun laws. The anti thesis will focus on the opposition’sRead MoreGun Control Laws Will NOT Reduce Crime Essay1700 Words   |  7 Pages â€Å"I have a very strict gun control policy: if theres a gun around, I want to be in control of it†. -- Clint Eastwood This nation was built on the right to bear arms, but this freedom is more controversial than ever. With all the school shootings and gun violence in America today at some point it may seem that just too take away all guns may be the answer to this problem. In defense, this is not the answer. If someone wants to commit a crime, gun laws will not stop them from obtaining the weaponRead MoreEssay Gun Control Does Not Reduce Crime1217 Words   |  5 PagesGun laws are a subject many people feel strongly about, and as with any subject people feel strongly about there are no shortage of data and statistics that seem to support either side. I decided to look into any correlation I could find between gun laws and deaths in the US. Just like with political parties and deficit spending I didnt really have any expectations, but would probably guess that there wasnt much correlation. Before I go any further Ill pretend like it is necessary to giveRead MoreGun Control Laws Will NOT Reduce Crime Essay1115 Words   |  5 Pages From the beginning of our nation up to today, we as a country have debated some of the most trying topics known to man. One topic that continues to make its way into our everyday lives is the epic â€Å"Gun Rights vs. Gun Control† argument. Opinions on both sides range from moderate to extreme, and some have even attempted extreme measures to get their points across. No matter what side of the argument you fall on, chances are, at some point, you can see the other point of view. It is this that causesRead MoreThe Pros And Cons Of Gun Control785 Words   |  4 PagesGun control is a big topic in the United States today, a lot of people have many different opinions on this. They are usually about whether we should we have gun control or not. We should not need gun control to solve crime in the United States. We need laws, background checks and more. The conversation about gun control will continue on as long as guns are made and used. The argument about gun control is doubled sided. This means that on one side citizens want the government to have control over

Institutions Free Essays

2489 5491 2489 5491 How does your text communicate information and ideas about institutions and individual experience? Institutions consist of protest, compliance and enforcement. Sometimes institutions harm the individual and sometimes they affect the individual in a positive way. The two texts, Shawshank Redemption (film) and Scales of Justice (television drama), both demonstrate this well, through various techniques such as narrating throughout the films. We will write a custom essay sample on Institutions or any similar topic only for you Order Now Both texts are about institutions in the criminal justice system. The text, Shawshank Redemption, portrays institutions as having a negative impact on the individual. In particular, it focuses on the strict elements of institutional life within prisons. These include set routines and structures that must be followed by the inmates. Schedules are enforced. A bell rings, doors open, prisoners step out and line up for morning head count. Enforcement and compliance are essential in the institution. Throughout the film one of the main characters ‘Red† is narrating, this communicates a different perspective of the effect institutions have on individuals. He expresses this when he says, â€Å"I’m telling you,  these walls are funny. First you hate them. Then you get used to them. Enough time passes, it gets so you depend on them. That’s institutionalised. † This quote shows a negative impact institutions can have on an individual, instead of wanting to be back in society they become dependent on set routines. The film also communicates the idea that once an individual has been institutionalised for a certain period of time, it becomes almost impossible for them to adapt back into society when they are released from prison. One way this is communicated is by the inmate Brooks’ protest against leaving Shawshank. Brooks has been in Shawshank for an extended amount of time, prison life and routine is now all he seems to know. It becomes obvious to the audience that even he feels he will not be able to adapt back into society. So terrified of leaving prison, he threatens to stab a fellow inmate so that his sentence will be extended, allowing him to stay in Shawshank. This results in Brooks taking his own life when he is finally released, emphasising the earlier reflection made by Red that some individuals can no longer survive without the institutional way of life. Scales of Justice (Act 1) is about a young and eager probationary constable (Webber) who is graduating from the police academy and has started to work for a police station. The audience sees that he is quiet young and naive through techniques like him twirling his gun around his finger like a young boy would with a toy gun. However as the text progresses we are see that Webber goes through stages of being ecstatic about his new job and not being able to wait to help society as they are â€Å" a walking conscience†, and loving the â€Å"perks† of the job, for example getting discounts on things like food and a car. The audience begins to find that the police station is one that is quite corrupt. As Webber beings to realise this, we see that the institution is having a negative effect on him by killing his dreams of being a walking conscience of society. At first this just makes him a little uncomfortable, but when it comes to actually seeing the corruption first hand (finding the fur coat in his locker) it brings things into perspective for him. 2489 5491 2489 5491 For a few days, the Webber considers keeping the stolen fur coat, as he takes it home with him. This is an example of the institution affecting is once very strong and clear conscience, this is the institution having a negative effect on him. Eventually, the guilt of possessing stolen property becomes too much for Webber, and he turns the coat into the head sergeant. Webber confesses that Sergeant O’Rourke was the one who took it and placed it in his locker. This results in more corruption which leads to Webber being dismissed from the police force. This is because the internal affairs investigator says Webber is lying and took the coat himself, when really the audience knows that he is dismissed because he turned on a fellow police officer. So in the end we see that being the â€Å"walking conscience† for society didn’t turn out so well for Webber. In conclusion, Shawshank Redemption and Scales of Justice; The Job, both communicate information and ideas about institutions and the individual experience. They both show the aspects of protest, enforcement and compliance within institutions and how the individual is affected through the institution, whether it is in a positive or negative way. How to cite Institutions, Essay examples

Financial Feasibility of the Business †Click to get a Free Solution

Question: Discuss about the Financial Feasibility of the Business. Answer: Introduction Mrs. Fanny who lives in Chicago has recently taken retirement and has received a sum of $475000 for 30 years of work with the pharmaceutical company. She has decided to start a new venture with the amount in hand. Mrs. Fanny wants to sell gourmet chocolates imported from France in the US markets. She will be purchasing the gourmet chocolates from Choc-O-LaySA an established company in France which is known for its fine chocolates with unusual and innovative flavors. Choc-O-LaySA will provide Mrs. Fanny exclusive rights to sell their products in USA. Mrs. Fanny will have to provide an upfront payment for the exclusive rights and the rights will be for 5 years. Her husband has decided to support her with her new business idea and has suggested to develop a financial plan for the feasibility of the business. Mrs. Fanny has conducted a market study in the USA to understand the demand of the gourmet chocolate and the price people will be willing to pay for the gourmet chocolate from France. The market survey by Mrs. Fanny revealed that the demand for the gourmet chocolate will be 750kg a month. But initially the demand will be only 75kg and gradually grow to its full potential and Mrs. Fanny will be able to sell 750kg a month by the end of the first year. The cost of the market study was $6500. Also it was found that the demand for the gourmet chocolate was price elastic i.e. the demand for the gourmet chocolate could be double if Mrs. Fanny reduced the price by 10%. Mrs. Fanny has decide to sell the gourmet chocolate directly to the customers via internet only and for this purpose has got in touch with a website developer who can make a website for her at $3500. She will require a refrigerator which will cost her $5250. The other expenses which Mrs. Fanny will have to incur are the packag ing and shipping cost of the gourmet chocolate to the customers which is at $2 per kg, credit card interest cost by the credit card company at 1% of the sales, rent of the office from where Mrs. Fanny will operate is $420 with a 3 month deposit to be paid and the cost of the employee who will help Mrs. Fanny with the business which will cost her $2650 per month. Apart from the internet sales, Mrs. Fanny will also be able to sell her gourmet chocolate t her friend Mrs. Mitch. Mrs. Mitch runs a small chain of delicatessens in Chicago. She is interested in Mrs. Fannys venture and has promised to purchase gourmet chocolate from her. However, she wants her to pack the gourmet chocolate in tin boxes with each tin box containing 550g of chocolates. She said if Mrs. Fanny could provide the same she will be purchasing 100 such boxes per month. The cost of purchasing such tin boxes is $1.75 per box and selling price would be $62. The assistant who can help Mrs. Fanny with processing such boxes will charge $750 per month. Mrs. Fanny will have to pay tax at 30% of the total profit generated every year. She can also request a loan of $50000 at 8% p.a. Mrs. Fanny wants to understand the financial implications of her business so that she can decide whether she should go ahead with this business or not. Breakeven Analysis Breakeven Analysis is a method to find the revenue a business must generate such that the total revenue is equal to the total cost of the business. i.e. at Breakeven point there is no profit and loss. It is given by Break even analysis = (Gallo, 2014) Cost of import of gourmet chocolates = 68.875 / kg = $76.45 [ 1 = $1.11] Transportation cost from France to USA = 18/ kg = $19.98 Shipping cost = $2/ kg Revenue = $120/ kg Credit Card cost = 1% of revenue = $12 Unit margin = 120 76.45 19.98 2 - 12 = $9.57 Refrigerator cost = $5250 Market study cost = $6500 Website design cost = $3500 Salary cost = $ 31800 Rent = $5040 Fixed costs = $5250 + 6500 +3500 + 40800 + 5040 = 61090 Thus breakeven point = 61090/ 9.57 = 5443.05 kg Thus Mrs. Fanny should sell more than 5443.05 kg of gourmet chocolate to earn profit. If the number of chocolates sold through internet is less than 5443kg then she will not be able to cover the fixed cost of $61090 she will incur. The net income of each month is given below. The company will be able to breakeven in 12 months. Month 0 1 2 3 4 5 6 7 8 9 10 11 12 Net income -24312 -11456 -3644 -2566 -1420 -275 871 2017 3163 4308 5454 6600 87458 Cumulative -24312 -35768 -39412 -41979 -43399 -43674 -42803 -40786 -37623 -33315 -27861 -21261 66197 Profit and loss statement ITEMS ITEM BREAKUP FIRST YR. Operating Revenue Sale from Internet 627750.00 Other Revenue Sales to Mitch 74400.00 Total Revenue 702150.00 Cost of Goods sold chocolate imported from France 557013.80 Operating Expenses Salary Assistant and Employee 40800.00 Rent 5040.00 Market Study 6500.00 Credit card 1% of the revenue 7021.50 Shipping cost Due to sales on internet 10462.50 Depreciation Assuming Straight line for 5 years 1050.00 EBIT Revenue minus expenses 74262.00 Net Interest Expense No loan taken 0.00 PreTax Profit revenue minus operating and interest expenses 74262 Tax Expense 30%on earned income 22278.66 Net Profit after Tax total revenue minus tax expenses 51983.54 The Profit and loss statement is a financial statement which helps in summarizing the revenues, expenses and recording profit for a specific period (usually a year). This statement is useful for the investors and owners to understand the revenues generated by the company and if the business is able to generate profits for the shareholders. (Investopedia) The Profit and loss statement can be divided into Operating revenue, Other revenue, Operating expenses, EBIT and Profit. Operating revenue The Operating revenue of the company is the revenue generated by the company from daily sales. Thus it is the main source of income of the business. In this case, the sale of gourmet chocolate to the customers via internet is the primary source of revenue and hence the operating revenue. The company was able to sell 5231.25 kg via internet at $120 per kg and hence the operating revenue = $627750. Other revenue The Other revenue of the company is the revenue generated by the company from sources other than daily sales. Thus it is secondary source of income of the business. In this case, the sale of gourmet chocolate to Mrs. Keith was the secondary source of income of the business and hence the other revenue. The company was able to sell 1200 units to Mrs. Keith at $62 per box. Hence the other revenue = $74400. Thus the total revenue of the company = 627750 + 74400 = $702150. Operating expense: The Operating expense of the company is the expense incurred by the company to complete it sales. In this case, the Operating expenses include cost of import goods sold, rent of office, salary to the employees, credit card cost, market study cost, depreciation and shipping cost. Thus total operating expense = 557013.80 + 5040 + 40800 + 7021.50 + 6500 + 1050 + 10462.50 = 627887.80 Assuming the life of the refrigerator to be 5 year and applying straight line depreciation on the refrigerator we get depreciation = 5250/ 5 = 1050. EBIT: EBIT is earnings before interest and taxes. It is the earning of the company by reducing all the expenses from the revenue earned by the company to get the earnings of the company before it pays interest on loan (if any) and taxes . For the business EBIT is calculate by subtracting the operating expense from the operating revenue. Thus EBIT = 702150 557013.80 = $74262.20 Interest expense It is the amount of money to be paid by the business as interest over the loan taken by the company. This amount is deducted from the EBIT before tax is implemented on the earnings as no tax is implemented on the interest. Mrs. Fanny has not taken any loan for the business. Hence the interest expense = 0 Net Profit The Net Profit of the company is the amount of profit generated by the company by doing business after paying taxes and can be given to the investors in the form of dividend or reused in the business in form of retained earnings. Net Profit = Profit Before Tax taxes = 74262.20 22278.66 = $51983.54. Taxes = 30% of 74262.20 = 0.3* 74262.20 = 22278.66 Conclusion Thus from the Profit and loss statement of the given business it can be said that the business will be able to generate profit in the first year and it will be equal to $51983.54. The revenue generated from sales was 702150 and the operating expenses were 627887.80. The net profit generated by the business is quite high and Mrs. Fanny will be able to easily expand her business and pay royalty to Choc. The overall financial health of the company looks good from the Profit and loss statement. Thus Mrs. Fanny should go ahead with this venture as the business will be able to generate profits in a year. Balance Sheet The Balance Sheet of a company is the financial statement which summarizes the total assets, liabilities and equity of the company at a given point in time. The Balance Sheet has three important parts: Assets, Liabilities and Shareholders Equity For any Balance Sheet, Assets = Liabilities + Shareholders Equity. (Averkamp, 2015) The following is the balance sheet for Mrs. Fanny ITEMS ITEMS Breakup FIRST YR CA Cash Generated from sales 68597.45 CA Receivables credit sales to customers 96200.00 CA Rent Deposit three month deposit 1260.00 CA Inventories Chocolate and tin inventory 76703.26 Total Current Assets 242760.70 NCA Equipment Refrigerator 5250.00 Accumulated Depreciation Life = 5 years and straight line 1050.00 NCA Investments website 3500.00 Total NCA 7700.00 Total Assets CA+NCA 250460.71 CL - Account Payable suppliers, wages, yearly rent 159688.51 Total Curr. Liabilities 159688.51 Total NCL 0 Total Liabilities 159688.50 Equity 38788.66 Retained Earnings 519683.54 Total Equity 90772.20 The balance sheet can be broken into Assets which consist of Current Assets and Non Current Assets, Liabilities which consist of Current Liabilities and Non Current Liabilities and equity which has shareholders equity and retained earnings. CA or Currents Assets The Currents Assets includes all the cash and cash equivalent of the company which can be easily converted to cash. Eg Cash, securities, advance payment, accounts receivables, inventory, etc. In this case Current assets of the company = $242760.71. NCA or Non Currents Assets The Non Currents Assets of the company are assets which take longer to convert to cash (more than one year). Eg Equipment, Investment in Website etc. In this case Non Current assets of the company = $7700. Thus the total assets of the company = 242760.71 + 7700 = 250460.71. CL or Currents Liabilities The Currents Liabilities are all the liabilities the company needs to pay to its account holders in a short span of time (less than one year). Eg Salary, rent, accounts payable, etc. In this case Current Liabilities of the company = $159688.51. NCL or Non Currents Liabilities The Non Currents Liabilities of the company are liabilities which the company needs to pay back in a longer period of time (more than one year).. In this case Non Current assets of the company = $0. Thus the total liabilities of the company = 159688.51 + 0 = 159688.51. Shareholders Equity: The Shareholders Equity consists of two parts: equity and retained earnings. Equity is the amount invested by the owners in the company to run the business. Retained earnings is the amount generated by the business as profit and which is reinvested in the business to help the business grow rather than sharing it with the shareholders. In this case Equity = 38788.66 and retained earnings = 51983.54. Thus Shareholders Equity = 38788.66 + 51983.54 = 90772.20 Cash Flow Statement The cash Flow Statement of a company tells in detail about the cash transactions of the company and helps in determining the cash present with the firm at any given point in time. In a business, the cash is used for operating activities (day to day operations of the business), investing activities (investment in long term assets like plant, property, machinery, etc.) and financing activities (purchase of shares, securities etc.) Cash Flow statement Month 1 Operating Activities Total revenue 0.00 Cogs 7232.44 Net income -7232.44 Rent -420.00 Credit card 0.00 Salary -3400.00 Cash used in operating activities -11052.44 Investment Activities Refrigerator -5250.00 Website design -3500.00 Rent advance Deposit -1260.00 Prepaid tax -22278.66 Market Study -6500.00 Cash used in investing activities -38788.66 Financing activities Equity 38788.66 The operating activities of the 1st month are: Revenue, Cost of goods sold, rent, salary, credit card cost. In the 1st month, the amount of gourmet chocolate sold will be received in the next month by the credit card company. Thus Revenue = 0. The Cost of goods sold is the amount paid for the purchase of the gourmet chocolate and shipping them to USA. COGS = $7232.44 Rent for the month = $420 Salary to the employees = 2650 + 750 = $3400 Since No revenue received this month, the cost of credit card = 0 Thus total cash flow in the operating activities = - (7232.44 + 420 + 3400 + 0) = - 11052.44 The amount is spent hence the cash flow is negative. The investment activities in the first month are purchase of Refrigerator, website design, market study, rent advance deposit and prepaid tax. Cost of refrigerator = 5250 Website design = 3500 Market study = 6500 Rent advance = 1260 Prepaid tax = 22278.66 Thus total cash flow in the investing activities = - (5250 + 3500 + 6500 +1260 + 22278.66) = - $38788.66 The financing activities in the first month is the amount invested by the Mrs. Fanny which is = $38788.66. Conclusion: The net cash flow value in the 1st month is negative. i.e. the cash outflow is more than the cash inflows. The revenue for this month will be realized in the next month so the income is zero but the expenditure for the month takes place hence net operating cash flow is negative. In the investment activities the cash outflow takes place due to purchase of assets and hence net investing cash flow is negative. In the financing activities, the cash inflow takes place due to investment from the equity. Annual Cash Flow Statement Cash Flow statement Year 1 Operating Activities Total revenue 702150.00 Cogs -504455.98 Net income 197694.02 Rent -5040.00 Credit card -7021.50 Salary -40800.00 Shipping cost -10462.50 Cash used in operating activities 134370.02 Investment Activities Refrigerator -5250.00 Website design -3500.00 Deposit -1260.00 Prepaid tax -22278.66 Market Study -6500.00 Cash used in investing activities -38788.66 Financing activities Equity 38788.66 Net cash 51983.54 The annual cash flow statement tells about the cash that goes in and out of the business. It helps in understanding where the cash was used and which the sources of revenue were for the company. The investors are interested in cash flow statement as it helps in determining whether the business will help them make profits and helps in understanding the viability of the business. In this case the net cash from the operating, investing and the financing activities is positive i.e. by doing the business the company will be generating more cash. Conclusion: The net cash flow is positive i.e. the company is able to generate cash by doing the business. Thus Mrs. Fanny should invest in the business as the business is profitable at the end of the first year. Discounted Cash Flow Analysis The discounted cash flow method is used for the valuation of the project by taking time value of money into consideration. In Discounted Cash Flow Analysis, the cash flow all the future years of the project is estimated and the these cash flows are discounted to their present value using the discount rate. If the sum of the discounted cash flow is less than the initial investment by the company, the company should not go ahead with the project but if the sum of the discounted cash flow is more than the initial investment by the company then the company should take the project as it will be profitable for the company. (Stockopedia, 2012) PV = present value = FV/ (1+r)n Where r is the discount rate and n is the number of years before the cash flow occurs, FV = future value of the cash flow. In this case, assuming straight line depreciation of the refrigerator with salvage value = 0 and life = 5 year, depreciation is calculated. Depreciation = (5250 - 0)/ 5 = 1050 Thus the Income statement for the next 5 years, assuming Mrs. Fanny is able to sell 750kg of gourmet chocolate each month is given below. Income Statement 5 years Year 1 2 3 4 5 kg of chocolates sold 5231.25 9000.00 9000.00 9000.00 9000.00 Sales 627750.00 1080000.00 1080000.00 1080000.00 1080000.00 Revenue from sales to Mitch 74400.00 74400.00 74400.00 74400.00 74400.00 Total revenue 702150.00 1154400.00 1154400.00 1154400.00 1154400.00 Expenses Rent 5040.00 5040.00 5040.00 5040.00 5040.00 Import of chocolate 504455.98 867881.25 867881.25 867881.25 867881.25 Shipping cost 10462.50 18000.00 18000.00 18000.00 18000.00 Credit card 7021.50 11544.00 11544.00 11544.00 11544.00 Employee salary 40800.00 40800.00 40800.00 40800.00 40800.00 Cost due to sales to Mitch 52557.83 52557.83 52557.83 52557.83 52557.83 Market Study 6500.00 0.00 0.00 0.00 0.00 Depreciation 1050 1050 1050 1050 1050 Total Expenditure 627887.80 996873.08 996873.08 996873.08 996873.08 Profit before Tax 74262.20 157526.93 157526.93 157526.93 157526.93 Tax 22278.66 47258.08 47258.08 47258.08 47258.08 PAT 51983.54 110268.85 110268.85 110268.85 110268.85 The discount rate is given as 4%. Hence calculating the DCF for the 5 years we get Discount rate @4% 1 2 3 4 5 Discounted cash flow 37131.10 56259.62 40185.44 28703.89 20502.78 Initial investment = 38788.66 Thus the net value of the project = -38788.66 + 37131.10 + 56259.62 + 40185.44 + 28703.89 + 20502.78 = $166272.82 Conclusion: Thus the net value of the project has been calculated and was found to be 166272.82. Thus by taking up the project Mrs. Fanny will earn $166272.82. Also the royalty she needs to pay to Choc-O-LaySA should be less than 166272.82 if she wants to earn a profit from the business. Sensitivity Analysis Sensitivity Analysis helps in finding how the change in an input value will affect the other dependent variables while the other assumptions are kept constant. (Investopedia, 2015). In this case the decrease in selling price by 10% will increase the demand by 2 times. Thus the company will be able to sell 150kg in the 1st month and the year-end monthly demand will increase to 1500 kg. Thus the new monthly cash flow statement will Month 0 1 2 3 4 5 6 7 8 9 10 11 12 kg of chocolate sold 150 375 487.5 600 712.5 825 937.5 1050 1162.5 1275 1387.5 1500 Sales 16200 40500 52650 64800 76950 89100 101250 113400 125550 137700 149850 162000 Revenue from sales to Keith 6200 6200 6200 6200 6200 6200 6200 6200 6200 6200 6200 6200 Total revenue 22400 46700 58850 71000 83150 95300 107450 119600 131750 143900 156050 168200 Expenses Initial Investment 16510 Rent 420 420 420 420 420 420 420 420 420 420 420 420 Import of chocolate 14465 36162 47010 57859 68707 79556 90404 101253 112101 122950 133798 144647 Shipping cost 300 750 975 1200 1425 1650 1875 2100 2325 2550 2775 3000 Credit card 224 467 588.5 710 831.5 953 1074.5 1196 1317.5 1439 1560.5 1682 Employee salary 3400 3400 3400 3400 3400 3400 3400 3400 3400 3400 3400 3400 Cost due to sales to Mitch 4380 4380 4380 4380 4380 4380 4380 4380 4380 4380 4380 4380 Total Expenditure 31275 45336 56652 67847 79042 90237 101432 112627 123822 135017 146212 157407 9882 Tax Prepaid 16957 Cash Flow each month -48231 -45336 -34252 -21147 -20192 -19237 -18282 -17327 -16372 -15417 -14462 -13507 146168 Thus it can be seen that the company will be able to recover the initial investment in 12 months and the profits will be much more than the profits earned at the current selling price. Hence the company should reduce the price. Conclusion Thus from the financial analysis I think Mrs. Fanny should go ahead with the venture as the business can breakeven in a year and generate profits for her and think that she should reduce her price by 10% so that profits are increased. Recommendations The following recommendations which I think can help Mrs. Fanny to run the business in a better way 1. In my view, the company should hedge the currency so that the fluctuations in dollar euro conversion rate will not affect the business 2. I would suggest Mrs. Fanny to choose suitable method of depreciation of assets to reduce the tax burden on the company. 3. I would recommend Mrs. Fanny to buy rights from Choc-O-LaySA at a price less than to earn profits in the business. 4. I think the company can reduce the shipping cost and bring efficiency in the distribution process to save on the spending. 5. In my view, investment in advertisement can help to increase the demand for the gourmet chocolate and hence the profitability of the business be increased. References Gallo,A. (2014). A Quick Guide to Breakeven Analysis. Retrieved on August 5, 2016 from https://hbr.org/2014/07/a-quick-guide-to-breakeven-analysis Averkamp, H. (2015). Introduction to Balance Sheet. Retrieved on August 5, 2016 from https://www.accountingcoach.com/balance-sheet/explanation Investopedia. (n.d.). Income Statement. Retrieved on August 5, 2016 https://www.investopedia.com/terms/i/incomestatement.asp Investopedia. (2015). Sensitivity Analysis. Retrieved on August 5, 2016 https://www.investopedia.com/terms/s/sensitivityanalysis.asp Stockopedia. (2012). What is a DCF Valuation? Retrieved on August 5, 2016 https://www.stockopedia.com/content/valuation-101-how-to-do-a-discounted-cashflow-analysis-63489/