Accounting assignments

· I have found out the all the graphs regarding the salary, vacation, ADV/TRNG, SPLY/LNDRY, FREIGHT, VEHICLES, DEMO’s, FLOOR-PLAN vs NRVS. We have observed these data pairs for a 60 month period i.e. five years. No there are no annual or the other seasonal patterns of trends immediately apparent.

· Yes, the slope of the trend lines makes sense. The slope of the line actually indicates the change in y-axis which is produced by the increment of x by 1 unit.

I have gone through the table from 2 to 4 and we have observed the pattern of operating profits over the five year period. There is no amount which appears to be odd.

Step 1 : Comment by Burcicki, Jim: Did not provide what is being asked for.

From the table 2, we have found that the Net variable revenues are being increased for the five years. The total amount of salaries, vacation, advertising & training, supplies/tools/ Laundry, Freight, Vehicle, Demonstrators and floor planning and the fixed expenses have been increased step by step. Total S-F expanses are the sum total of the number of salaries, vacation, advertising & training, supplies/Tool/Laundry, Freight, vehicle, demonstrators, Floor planning.

Step 2:

I have noticed the data on semi-fixed an expense which is contained in table 3. No there is no unusual or odd patterns in the detailed financial data. So there are 5 expenses that have the oddity about them which doesn’t make sense. Yes, there are unusual patterns we have noticed in this financial data. For the month 1 to 6, 8-10, 12, 13, 29, 30, 41, the vacation is blank. This is the oddity about them which doesn’t make sense. There are 4 expenses that ‘Stick out’ as not being correct and one that has an unusual pattern. The unusual pattern is seen in the column of ‘vacation’. Comment by Burcicki, Jim: You are repeating what was provided in the feedback/instructions but not what is being asked for.

Step 3 : Comment by Burcicki, Jim: Missing the ttable with the figures being asked for.

I have estimated the value of the given table no 3. The high low method is the fundamental tool which is mainly employed in order to determine what kind of cost is fixed and which one is variable. If the high and low activity level doesn’t match the high and low expense measure, there may have the problem regarding the accuracy level under the stable cost. There might be inaccuracy in the value of variation.

Step 4:

Table 5 is given below: Comment by Burcicki, Jim: Figures are not formatted properly –alignment, dollar and cents amount and two decimal places as per instructions and feedback.

1.

The problem is that the number of the variable cost for the salaries is normal. But for the other, the variable cost is much low and in some cases, the value seems to be negative. Another problem is found that the value of r and the ‘R squared’ is much less.

2.

From the result, it has been found that the value of R-squared measures is much low.

3.

For Salaries, Demo’s, SPLY/LNDRY, ADV/TRNG, Floor Plan the slopes are negative and for the rest it is positive.

4.

Yes, the conclusion is consistent with those from the high low effort.

Step 5:

1.

Yes, the Motomart data can be used to prepare a reliable financial forecast. From the data the fixed cost, variable cost and squared R it is easier to make the breakeven analysis. Now the break-even analysis is used in the sales forecasting while it is about t develop the pricing strategies. The breakeven analysis can be found by the fixed cost which is divided by (revenues per unit-variable costs per unit). Basically the fixed cost is not related to the volume of sales volume and on the other hand, the variable cost is related to the sales or production. So hence if the variable cost and fixed cost can be measured then it will be easier to forecast. Comment by Burcicki, Jim: This is not correct.

2.

If Motomart is included in the very large database used to prepare the financial forecast that supports the relocation of Motomart closer to existing Dealer, then with respect to the remainder of the database used for this forecast the following concerns should be considered:

· Moving average

· Exponential smoothing

· Extrapolation

· Linear prediction

· Trend estimation

For the better forecasting method, the upcoming events should be considered as it also depends on the present and past events. When it is about to plan for the future development it is important to consider the given points regarding the forecasting. Forecasting refers to formal and statistical methods and these data are being generated by estimating the existing values.

3.

Yes, I rely on this forecast. All the given and estimated data are important for the forecasting method of the Motomart Company.