Instructions

This material consists of four assignments. Each assignment has a number of questions which have all been given an approximate weighting. The weightings are used in the overall exam assessment.

All the assignments must be completed independently of each other. The assignments come with an accompanying Excel file, which has a number of appendices containing data and templates. In addition, there is a Word document containing all the questions.

Download:

The Word document with all the questions can be downloaded here.

The Excel file with all the appendices can be downloaded here.

Remember:

Save the files on your computer before you start to use them.

Communication with anyone else during the exam is not permitted.

Assignment 1

Company analysis

Plantorama A/S is Denmark’s largest chain of garden and pet centres, with 11 large stores located in Jutland and on Zealand and Funen. In addition, the company has a busy online store. The company has an extensive product assortment that ranges from garden plants, houseplants, soil and fertilisers to hand tools, ceramics, aquatic gardens and gift items. Furthermore Plantorama A/S operates a number of pet centres selling everything from aquarium fish and pet food to pet birds.

Plantorama A/S is a Danish family-owned company that was founded by Søren Vang Christensen, the fifth generation in a line of horticulturalists. Plantorama A/S opened in 1987, and for an initial period was part of Gartneriet Skærgården. To begin with, Plantorama A/S was best known for selling potted plants, but over the years, the business has grown in terms of both the size of its stores and their product range. Today, Søren Vang Christensen’s son, Peter Vang Christensen, is CEO of the company.

Plantorama A/S works with sustainability, and in order to keep up and draw attention to its efforts, three focus areas have been selected:

Products
As sustainable, spray-free and organic plants become available as an alternative to conventional plants, Plantorama will choose to sell these instead. Concentrates and pesticides have been phased out and replaced with plant protection products made from naturally occurring substances.
The assortment also includes products that promote biodiversity, such as insect hotels and bee-friendly plants, as well as products made from recycled materials.
Buildings and operations
When building and renovating centres, the environment and the climate are taken into account to the greatest possible extent, for example by installing solar cells that supply much of the electricity used. Highly insulated roofs, sun-screening and blinds keep the temperature down during the day and save heat at night, and energy-saving LED lighting has been installed. Moreover, the plants are watered using rainwater collected from the roofs.
Social Responsibility
Within the company, the focus is on employee development and on creating a healthy and safe workplace by, among other things, introducing health initiatives and health ambassadors. A share of the payroll budget is earmarked for training, and the company has also established its own training programme in collaboration with Kold College in Odense, and with VidenDjurs, the main educational partner on Djursland. Finally, the company conducts annual job satisfaction surveys.
Gender diversity at management level has been strengthened, so that today the gender distribution of the management at head office is 40 % women and 60 % men. Moreover, people in flexi-jobs and trainees are taken on in collaboration with job centres.
The company also makes donations to charitable causes, including Julemærkefonden (Christmas Seal Foundation) and Animal Protection Denmark, which in their own way aim to give others a fresh start in life.

In 2020, Plantorama A/S had 252 employees. Revenue totalled DKK 536,943 thousand and the profit before tax was DKK 56,406 thousand.

This assignment comes with the following material:

Internal material:

Article:

Plantorama opens new restaurant and play area, Århus Stiftstidende, 6 May 20211

Key figures:

Adapted accounting and key figures for Plantorama A/S for the years 2018 to 2020. See Appendix 1 of the Excel file.

Questions 1.1 - 1.6

1.1 (10%)
Based on the accompanying material, explain which factors have impacted Plantorama A/S’s financial development from 2018 to 2020.

1.2 (15%)
Analyse the development in the index figures for the earnings and asset use efficiency (capital adjustment) from 2018 to 2020 with the help of these factors. See question 1.1.

The key figures can be found in Appendix 1 of the Excel file.

1.3 (10%)
Assess how the development in the index figures affected the profit margin ratio and the asset turnover ratio from 2018 to 2020.

The key figures can be found in Appendix 1 of the Excel file.

1.4 (5%)
Explain why the liquidity ratio increases from 119.3% in 2018 to 218.7% in 2020.

The key figures can be found in Appendix 1 of the Excel file.

1.5 (5%)
Discuss whether it is an advantage for Plantorama A/S to focus on sustainability.

1.6 (5%)
Explain how the opening of a new restaurant and play area affects Plantorama A/S’s business model.

Assignment 2

The company

Vinimportøren A/S is one of Denmark’s largest and fastest-growing online wine stores, but it also has one of the country’s biggest physical wine shops. The company imports directly and without using expensive intermediaries from many exciting winemakers worldwide. The company’s procurement manager has, for example, found a fantastic wine called ‘LuLu’ on a visit to southern Italy, and has been thinking about importing a consignment from the wine producer Mascadel. The company’s customers are private consumers, who are able to choose from a very wide selection of both wines and spirits.

The business concept is to offer quality wines at the best prices on the market. Therefore, a taste guarantee is offered, so that if a customer does not like the wine they purchase, they have a one-month right of return. Vinimportøren A/S is able to offer this guarantee because of its close relations to a large and influential network of producers, suppliers and partners all over the world. The network ensures constant access to a wide and varied range of quality products at competitive prices.

The company’s values are:

“We say what we do – and we do what we say quickly.” However, speed is never at the expense of professionalism and sound shopkeeping principles. In this way, we are loyal to both our customers and ourselves.
We want to be innovative, unorthodox and ‘the cheeky boy in class’ who challenges the other players in the market. However, the solutions we choose are based on propriety, quality and customer needs.
We love wine, and sometimes we can be pretty nerdish about it too, but we are not in any way wine snobs. We talk to people as equals.

Questions 2.1 - 2.3

2.1 (5%)
Prepare the distribution chain for the wine LuLu.

2.2 (5%)
Assess why Vinimportøren A/S has chosen this distribution chain. See question 2.1.

2.3 (5%)
Assess the benefits for Vinimportøren A/S of deciding on a number of company values.

Assignment 3

Annual report

Cocktail ApS was founded almost six years ago and has grown at rocket speed. Today, the company is Denmark’s largest wholesaler within the sale of sprits.

The idea behind Cocktail ApS is to supply bars and restaurants with spirits. In addition to selling spirits, much of the company’s revenue comes from the sale of cleaning articles, vacuum cleaners, paper tablecloths, light bulbs, hand sanitiser, ice cubes and dice cups. Furthermore, the company sells fruit such as limes, lemons and oranges as well as other cocktail ingredients.

The company’s finance department needs to start preparing the company’s annual report for 2021. The trial balance is shown in Appendix 2. The new trainee economist in the department wonders why there is an account 12210: Trade receivables.

Questions 3.1 - 3.3

3.1 (10%)
Prepare an income statement (profit and loss account) for 2021 and a balance sheet as at 31 December 2021 for Cocktail ApS.It is not necessary to prepare notes.

The trial balance can be found in Appendix 2.

A template for the income statement (profit and loss account) and the balance sheet can be found in Appendices 3 and 4, respectively.

3.2 (5%)
Explain how Cocktail ApS benefits from having four different accounts for the sale of goods and the cost of sales in the bookkeeping.

3.3 (5%)
Explain why account 12210: Trade receivables appears from the trial balance.

Assignment 4

Earnings

Mitkøb.dk is an online supermarket that delivers goods directly to customers. The supermarket has no physical stores. It stocks an extensive range of groceries, including organic products, discount products and branded products. Every so often, spot consignments of other product types such as books and toys are also offered. The goods are delivered to customers in all the largest towns and cities in Denmark.

The procurement manager recently purchased a consignment of cheap ink cartridges for selling as spot goods in the coming week. The cost price for the consignment of 800 ink cartridges is DKK 40.000. The consignment is purchased as is, so no discount is given for any damaged goods, and nor can they be returned to the supplier.mitkøb.dk expects to be able to sell the ink cartridges at a price of DKK 127.20 each.

Questions 4.1 - 4.3

4.1 (5%)
Calculate the contribution margin per piece and in total for the consignment of ink cartridges.

The information you need can be found in Appendix 5.

4.2 (5%)
Calculate the contribution ratio for the consignment of ink cartridges.

4.3 (5%)
Explain how the contribution ratio will be affected if some of the ink cartridges are damaged and have to be sold at a lower price. See question 4.2.