HI5017: Potential Uses of the Cost Information for Decision-Making - Operation Costing - Accounting and Finance Assignment Help

Assignment Task :

Assignment Specifications

Assessment task:
Part A
Review the existing literature to critically examine the relative information content of the income statement and the statement of cash flows. Why do investors find both income statement and statement of cash flows useful?
 

Part B
Download the annual financial reports of BHP Ltd, Santos Ltd, and Funtastic Ltd for the year 2019, 2018 and 2017. Examine the consolidated Cash Flow Statements for each companies across three years. Answer the following questions about each of the three cash-flow statements.
1. For each companies [except mentioned otherwise as in c), g) and i) below], across three years on the Statement of Cash Flows discuss:
a) What are the major sources of cash for each firm? What are the major uses of cash for each firm?
b) What was the trend in cash flow from (continuing) operations for each firm?
c) Compare and contrast the cash flow from operations with the net profit after tax in income statement. Explain in detail the major reasons for the difference between these two figures. (Answer this question using only the Cash flow statement for BHP Limited).
d) Was the firm able to generate enough cash from operations to pay for all of its capital expenditures?
e) Did the cash flow from operations cover the dividend payment made by the firm ?
f) If the firm has generated excess cash from operations, how did the firm invest the excess cash? If not, what were the sources of cash the firm used to pay for
the capital expenditures and/or dividends?
g) Did the firm use the working capital (current asset and current liability) accounts other than cash and cash equivalents as sources of cash, or uses of cash? 
h) What other major items affected cash flows for each firm?
i) What was the trend in capital expenditures for each firm?
j) What was the trend in dividends (if any) for each firm?
k) What was the trend in net borrowing (proceeds from borrowing less payments of short- and long-term debt) for each firm?
l) What was the trend in working capital accounts? (Answer this question using only the Cash flow statement for BHP Limited).

Part A
Choose ONE of the costing systems studied in this unit from the list below, and answer the questions that follow:
• Job Costing
• Process Costing
• Operation Costing (Hybrid Costing)
• Activity-based Costing (ABC)

Questions:
1. Briefly discuss the features of your chosen costing system.  
2. Identify 2 specific Australian companies that your chosen costing system is suitable for, and explain why.
3. Discuss two potential uses of the cost information for decision-making, to the managers in each of the 2 organisations selected in Q2 above 

Part B
Choose one peer reviewed journal article (from any country) on the: Use of your chosen costing system in a real-life organisation (i.e. a case-based empirical study). The article should be published between 2005 – 2020. Choose your article only after you have accessed and reviewed several relevant articles, and then choose the best article that will answer the questions below.
 

Questions:
1. Based on your chosen costing article, briefly summarise how the costing system was designed and implemented in your real-life organisation. 
2. Based on your chosen costing article, did the costing system in the study satisfy the features discussed in Part A (Q1)? Why or why not? Include examples in your answer from your costing article.  
3. Based on your chosen costing article, how useful was the cost information to the internal users in the organisation? Discuss with examples from your costing article.  
4. Based on your literature findings, state two key lessons that would inform contemporary organisations about the practical use of your chosen costing system.

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