MBA 520 Module Six Activity- forecasting financial statements using actual numbers and explaining the meaning of the analysis

MBA 520 Module Six Activity Guidelines and Rubric
Overview: For this task, you will practice forecasting financial statements using actual numbers and explain the meaning of the analysis.
Prompt: First, review the Module Six resources. Then revisit Chapter 10 in the textbook, which was assigned in Module Three. For this practice activity, we will
use the
End of Chapter exercise from pp. 703–704: “10.11 Identifying the Cost Structure and Projecting Gross Margins for Capital-Intensive, Cyclical Businesses.”
This includes the AK Steel case study. After reading the case study, answer the questions below in the
Module Six Activity Worksheet. Refer to the textbook and
other course materials to support your responses.
A.
Cost Structure: Compute the cost structure for each firm. You will need to calculate three variables for both companies:
1. Variable Cost per Dollar of Sales = Change in Cost of Products Sold / Change in Sales
2. Total Variable Cost = Variable Cost per Dollar of Sales * Sales
3. Total Fixed Cost = Total Cost of Product Sold – Total Variable Cost
B.
Structure of Manufacturing Cost: In one paragraph, compare the structure of manufacturing costs for each firm.
C.
Projected Financial Information: Compute the projected sales, cost of products sold, gross profit, and gross margin (gross profit as a percentage of sales)
of each firm for Year +1 through Year +5. Using the table in the Module Six Activity Worksheet is recommended.
D.
Gross Margin Comparison: In one to two paragraphs, explain why the levels and variability of the gross margin percentages differ for these two firms for
Year +1 through Year +5. Provide an example comparing the effect of the change in gross margin. (For example, if gross margin changed from 25% to
35%, what would it mean for each company?)
Rubric
Guidelines for Submission: Complete and submit the Module Six Activity Worksheet.

Critical Elements Exemplary (100%) Proficient (90%) Needs Improvement (70%) Not Evident (0%) Value
Cost Structure Calculates the cost structure,
including variable cost per
dollar of sales, total variable
cost, and total fixed cost for
each company without any
errors
Calculates the cost structure,
including variable cost per dollar
of sales, total variable cost, and
total fixed cost for each company,
but there is one calculation error
Calculates the cost structure,
including variable cost per dollar of
sales, total variable cost, and total
fixed cost for each company, but
there is more than one calculation
error
Does not calculate the cost
structure, including variable cost
per dollar of sales, total variable
cost, and total fixed cost for each
company
22.5
Structure of
Manufacturing Cost
Meets “Proficient” criteria and
demonstrates a nuanced
understanding of the financial
impact of the structure of
manufacturing cost
Provides a complete, concise, and
accurate analysis of the structure
of manufacturing cost for each
firm, and analysis is well
supported by information from
the course text and resources
Provides an analysis of the
structure of manufacturing costs
for each firm, but the analysis is not
concise, incomplete, or inaccurate,
or is not supported by information
from the course textbook and
resources
Does not provide an analysis of
the structure of manufacturing
cost for each firm
22.5

 

Critical Elements Exemplary (100%) Proficient (90%) Needs Improvement (70%) Not Evident (0%) Value
Projected Financial
Information
Computes the projected sales,
costs of goods sold, gross
profit, and gross margin for
years 1–5 without any errors
Computes the projected sales,
costs of goods sold, gross profit,
and gross margin for years 1–5,
but there are 2–10 calculation
errors
Computes the projected sales,
costs of goods sold, gross profit,
and gross margin for years 1–5, but
there are more than 10 calculation
errors
Does not compute the projected
sales, costs of goods sold, gross
profit, and gross margin for
years 1–5
22.5
Gross Margin
Comparison
Meets “Proficient” criteria and
provides multiple specific
examples that illustrate the
meaning of a change in gross
margin
Provides a complete, concise, and
accurate explanation of why the
levels and variability of the gross
margin percentages differ for the
two firms, and explanation is well
supported by information from
the course textbook and resources
and contains a specific example
that illustrates the meaning of a
change in gross margin
Provides an explanation of why the
levels and variability of the gross
margin percentages differ for the
two firms, but the explanation is
not concise, incomplete, or
inaccurate, or is not well-supported
by information from the course
textbook and resources, or lacks a
specific example that illustrates the
meaning of a change in gross
margin
Does not provide an explanation
of why the levels and variability
of the gross margin percentages
differ for the two firms
22.5
Articulation of
Response
Submission is free of errors
related to citations, grammar,
spelling, syntax, and
organization and is presented
in a professional and easy-to
read format
Submission has no major errors
related to citations, grammar,
spelling, syntax, or organization
Submission has major errors
related to citations, grammar,
spelling, syntax, or organization
that negatively impact readability
and articulation of main ideas
Submission has critical errors
related to citations, grammar,
spelling, syntax, or organization
that prevent understanding of
ideas
10
Total 100%

 

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